Vietnam's service/retail and investment by Japanese companies increase | Ho Chi Minh's advancement consulting, accounting, taxation and auditing [SAC]

Vietnam service/retail, investment by Japanese companies increased

UNIQLO, a Japanese retail giant, opens a store in Ho Chi Minh

Services and retail are expected to attract a large amount of Japanese direct investment in Vietnam this year. In December 2019, UNIQLO opened its first store in Ho Chi Minh, and 2,000 people rushed to it before the opening.

Vietnam's retail and service industry attracts Japanese companies (JETRO)

The Japan External Trade Organization (JETRO) reported, "As Vietnam's power consumption increases nationwide, the number of Japanese retailers and service companies is increasing to find opportunities in growth markets." According to JETRO, non-manufacturing direct investment from Japan to Vietnam has also increased, representing AEON and UNIQLO. Compared to the previous year, Japan's registered investment capital has decreased, but the number of new projects by Japanese investors has increased.

Investment in Vietnam from Japanese companies, service/retail (non-manufacturing) increase

According to a JETRO survey, 63.9% of Japanese companies say Vietnam is "63.9% of Vietnamese Japanese companies are the most focused markets in the ASEAN region".

Most of Japan's large-scale manufacturing companies have already transferred to Vietnam, and most direct investment is expanding existing businesses such as capital increase. In addition to that, non-manufacturing investments and investments from SMEs have also increased, and we report that investment amounts from Japan will continue to increase.

Expectations for Vietnam's service/retail industry are higher than Thailand (JICA)

According to the Japan International Cooperation Agency (JICA), "Three years ago, Thailand was a more attractive market for Japanese investors and companies, but now it shows a growing interest in Vietnam, Not only that, investment in the service industry with a view to Vietnam as a whole will continue for the next few years." JICA said, "Vietnam has a large market with more than 96 million people, and its service sector has great potential. That is why retailers such as UNIQLO, AEON and many other Japanese companies have entered the market. That's the reason."

In JICA,

In addition to retail and services, we also anticipate increased investment in other areas.

"There is room for growth in hotels, healthcare, IT services, transportation, HR and education."

Japanese companies tend to be cautious about investing, according to Do Nhat Hoang, director of foreign investment at the Ministry of Planning and Investment. Last year, US$1.07 billion in direct investment from Japan was second only to South Korea's US$1.58 billion.