Why Japanese Are Interested in Da Nang?

  There are many advantages in geographical location, low labor costs, open investment environment... have made Da Nang becoming more and more attractive to Japanese investors. The cooperative relation between Da Nang and Japan has already had a solid foundation and are in the best development stage...

Previously, many Japanese investors are often interested in Hanoi or Ho Chi Minh City (HCMC) but recently they have been paying much attention to Da Nang - the city by the Han River. Besides the natural advantages, the Da Nang Government has also actively support and creates favorable conditions for investors, including Japan.

Recently, Da Nang and Japanese localities have also actively expanded their friendly cooperative relations in various fields. Da Nang has officially signed the Memorandum and deploy the friendship cooperation with Kawasaki, Sakai Yokohamam, Mitsuke and is taking steps to promote expanded cooperation, towards the signing of the Memorandum with Nagasaki, Kobe, Yaizu, Fukuoka, Otawara, Nemuro, Kushiro, Matsusaka. Da Nang is Vietnam's pioneering province of Vietnam that has representative office in Tokyo...

Up to now, there are more than 120 enterprises and representative offices of the company from Japan have been active in Da Nang, with total investment of about 500 million USD, creating more than 30 thousand jobs for local workers. Annually, Da Nang also welcomed about 200 Japanese delegations came to survey and seek opportunities for cooperation and investment.

There are many projects in Da Nang that are constructed using ODA capital from Japan such as Hai Van Tunnel, the project to upgrade Tien Sa port, Da Nang Hospital...

Da Nang has a favorable geographical location as international gateway when lying on the East - West economic corridor, linking the countries in the ASEAN region. In addition, Da Nang has open investment environment with the liberal policies, implemented by the Government, transparent and facilitate administrative transactions...Moreover, Da Nang also has the advantage of cheap labor costs. Labor cost here is only 1/3 the salary paid to Chinese workers, an important factor in deciding to investment...

To welcoming the wave of Japanese investors, Da Nang has applied teaching Japanese language at secondary and high schools. Until now, Da Nang is province with the highest the number of students who study Japanese language in the central of Vietnam.

We, ANT Consulting company, support you with the service of set up a company in Vietnam, Risk management in Vietnam, Employee background check in Vietnam... to help you shorten the implementation time.

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Nielsen: Vietnam Is a Land of Potential Opportunities

  According to Nielsen, Vietnam consumers is the motivation for economic development as they are willing to spend more and are also living in the lands of the potential opportunities. By 2020, Vietnam middle class will grow double, from 12 million people in 2014 increased to 33 million people in 2020.

Vietnam is among the top countries with the most optimistic consumers in the world, with more income and more spending. The percentage of increasing in per capita income rose in 2012 by 44% compared to 2010. The average growth rate of the monthly spending per person in 2012 increased by 32% compared to 2010. Therefore, Vietnam people have a strong desire for a better life, demanding about quality when 73% of people are willing to pay for higher quality.

Health is an important issue while there are 39% see health as the most concerning problem in life. Vietnam consumer’s monthly savings is to prepare for future problems, while 34% goes for the future of children, 12% is for health and 11% savings for house purchasing.

Consumers in Vietnam are also having more opportunities for shopping than ever. Modern trade channels are gaining significant role when 42% of consumers buy groceries at the supermarket more often. However, the utility factor is gradually becoming a way of life and developing quickly because of the accordance with the youth and officer with 23% of students and 36% of officer go shopping in the supermarket, convenient shop.

However, grocery store is still the dominant shopping channel in the market, while over 80% of sales of fast moving consumer goods coming from grocery stores, with 1,3 million stores across the country.

Technology offers more opportunities to help Vietnamese consumers connect. Smartphone is booming in Vietnam when nearly 1 in 2 Vietnamese people owning a smartphone, most of rural consumers watch TV daily. Online sales channel has also been in the market with 28% of Vietnamese consumers prefer online shopping.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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The France, Taiwan Phone Companies Invest in Vietnam to Take Advantage of TPP?

  The information that Vietnam has finished the TPP negotiation pushing many phone manufacturing companies like Archos (France), Compal (Taiwan) to promote their market expansion plan and investment in through setting up business in Vietnam.

The Archos phone company (France) and their distributor – Petrosetco (Vietnam) are recently launching 7 product lines in Vietnam market.

Mr. Frederic Balay - Senior Vice President and CEO in charge of North American of Archos has opined that Vietnam is large market which phone demand is constantly increasing every year. Along with that, while Vietnam is an official member of the TPP, the market will be extended to billions of people and 40% of global GDP, attractive offers on tariffs for intra-origin goods.

Mr. Frederic Balay also said that these product lines are designed by a team of engineers in France and factories in China of Archos are undertaking production. But he revealed that the company is making long-term plans in Vietnam market.

At the end of September, a major phone producer - Compal (Taiwan) also confirmed their decision to return to Vinh Phuc to continue investing in the plan to produce smart phone which was left unfinished at the end of 2007.

Mr. Vincent Lee, Deputy General Director of Compal factory in Vietnam said that in two recent months, Compal has urgently repaired factory system; installed equipment, machinery; worked with a number of localities inside and outside of the province for employment and preparing to welcome the world's top customers to visit exploring opportunities for investment and cooperation in smart phone manufacturer in Vinh Phuc.

Vinh Phuc leader suggested that Compal should shorten the negotiation with partners, and soon to announce the list of products to be produced, as the basis from now until the end of 2015.  The province can adjust the investment certificate has signed and complete the procedures, mechanisms and policies to support the project in accordance with the law of Vietnam.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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FDI Capital Flowing into Vietnam in The First 10 Months of 2015

  Vietnam is positive in receiving foreign investment from Malaysia, South Korea, UK, Japan...in setting up business and M&A activities in various sectors.

The investment capital has been registered with major projects licenced in Tra Vinh, Ho Chi Minh City, Dong Nai, Binh Duong, Ha Noi, Tay Ninh, Hai Phong, Quang Ninh.

Investment projects licensed are mainly in the area of processing and manufacturing, real estates and services.

According to new figures released by the General Statistics Office of Vietnam, from the beginning of this year to October 20^th 2015, there have been 1,657 newly licensed FDI projects with total registered capital of nearly 12.43 billion USD, increased by 26.9% of total projects and 24.8% of total capitals over the same period in 2014. There are also 667 projects licensed from the previous year registering for capital increase reaching 6.87 billion USD.

We, ANT Consulting company, support you with the service of set up a company in Vietnam, Risk management in Vietnam, Employee background check in Vietnam... to help you shorten the implementation time.

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Foreign Corporations Want to Invest in The Vietnam Seaports

  Sebrina Group Holdings Ltd (Singapore) expressed their desire to seek more opportunities for cooperation between the Group and the Ministry of Transport of Vietnam in the near future; they also showed their interest in the projects to build seaport in Vietnam...

At the meeting with Minister of Transport Dinh La Thang on September 3^rd, Mr. Nasrat Muzayyin - CEO and Co-founder of Sebrina Group Holdings Ltd (Singapore) expressed his desire to seek more cooperation opportunities between the Group and the Ministry of Transport of Vietnam in the coming time.

Accordingly, Sebrina Holdings is a strong business in the energy sector. The Group wants to find out traffic projects related to energy in Vietnam. Simultaneously, the Group also expressed interest in the projects to build seaport in Vietnam.

Presently, Vietnam needs to develop breakthrough many sectors, in which transportation infrastructure is seen as one of the bottlenecks that need to develop rapidly in the future.

On that basis, the Minister appreciated the interest of foreign investors, including the Sebrina Group Holdings Ltd and pledged to create favorable conditions for investors to access to essential information about projects for researching and investment in developing the transportation infrastructure in Vietnam.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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Investment Waves from Japan Continue to Rise

  It has been observed that Vietnam continues to receive foreign investment switched from from China, Thailand into Vietnam to acquire shares or set up business in Vietnam in real estate, manufacturing, and other services, especially from Japan investors.

On July 31^st, 2015 Forval Group has partnered with Tin Nghia Corporation and Dong Nai Container Port JSC to announce the establishment of Japanese Small and Medium Enterprises Development JSC (JSC) with an investment capital of 772 billion VND.

Accordingly, the JSC will build the infrastructure of workshops dedicated to the small and medium Japanese enterprises in Nhon Trach 3 Industrial Zone on 18,2ha area.

The community of Japanese SMEs tends to invest abroad but there is no need to rent vacant land but to rent factory space to shorten the time of initial investment. Therefore, the construction of the factory infrastructure to attract Japanese SMEs is efficient model.

Earlier, on July 26^th, 2015, Creed Group Investment Funds (under the Creed Group - Japan) signed a 200 million USD investment project in An Gia Investment and Property Development JSC. Besides, Creed Group also provides loans for An Gia to buy project, building high quality Japan housing projects in HCMC. In addition to financial investment, Creed Group has also transfer the real estate development technology for An Gia. But this is only the first step in the strategic partnership between the two sides. Creed Group will continue to increase investment if real estate market developed well.

Another Japanese corporation that is Kyocera Mita in May has also invested in building a factory in Hai Phong with capital of 200 million USD. The project was built in Vietnam – Singapore Urban, Industrial and Services Area (VSIP Haiphong) with an area of 20ha, specializes in manufacturing all types of printers, copiers for export to 140 countries around the world.

According to data from the Foreign Investment Department (Ministry of Planning and Investment), by the end of Quarter II/2015, Vietnam has attracted 2,551 projects with a total investment capital of up to 37.7 billion USD. Particularly in HCMC, there are 787 Japanese companies are operating in many sectors from retail, real estate, manufacturing, science and technology...

Early of June 2015, the delegation led by Mr. Iwasaki Yasuo, Vice Governor of Saitama City is visiting HCMC to exchange the cooperation opportunities. Continued with the investment trend, during the connection day between Japan and Vietnam companies in the field of agricultural, food, held in HCMC on July 31^st 2015, 25 Japanese companies have also met with 100 Vietnam companies to explore business opportunities. Since last year there have been over 6,000 Japanese businessmen came to find out information about Vietnam market with the desire to invest and expand their business here.

In particular, 60% of enterprises are interested in service fields such as restaurants, hotels, wholesalers, retailers, the remaining opportunities are in the field of manufacturing and processing.

With the advantages of labor and investment environment have increasingly been improved, some Japanese companies that are investing in Thailand and China have decided to choose Vietnam as next destination. Jetro's survey showed that as many as 25% of enterprises operating in China said they would move to Vietnam in the coming years.

Because of labor costs are increasing but limited workforce, many Japanese companies have tended to move abroad and Vietnam is the preferred destination. The wave of investment into Vietnam will continue to increase in the future, including commissioned production form.

The wave of companies shifting from China to 3^rd country has occurred for some years, however, at the present, this trend is growing fast. The reason is that labor costs in China rising, and many other obstacles. While Vietnam has favorable conditions for investment and development through young labor force and low labor costs. With over 90 million people, Vietnam is the 3^rd largest market of South East Asian region and this market is continuing to open when the ASEAN Economic Community was established by the end of this year. In addition, the investment environment in Vietnam is increasingly improved and the performance of businesses has developed.

The survey conducted by JETRO in 2014 showed that there are 66% of Japanese companies in Vietnam want to expand operations in the next few years because of good business performance. Up to 84.4% of Japanese companies participating in the survey said that they have higher revenue in 2014 than in 2013, with production sector, up to 70% enterprises see high potential in Vietnam market. Besides the favorable conditions to attract investment, the support from the Bank of Japan also help Japanese companies expand business strongly. One of the "synergy" of Japan investors is Tokyo Mitsubishi UFJ, the country's largest bank with market capitalization of up to 170 billion USD.

Mr. Nobuyuki Hirano, President of Tokyo Mitsubishi UFJ Bank in the meeting with Prime Minister Nguyen Tan Dung in April 2015 said they would continue to support capital for the Japanese businesses to invest in Vietnam, as well as support Vietnam in the development of supporting industry, high technology industry, infrastructure and agricultural development.

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FDI flows into Vietnam from China?

 In the longer term, FDI flows may decrease in China and move out of the country. Vietnam has the opportunity to attract investment capital when many investors wish to set up business to enter Vietnam market.

Earlier, according to the survey of FDI Market in the Asia - Pacific region, Vietnam is the 2^nd largest country that attracts FDI after China. However, rising labor costs in China in recent years has created opportunities for the emerging markets in Asia including Vietnam to enhance their competitiveness in the manufacturing sector.

Specifically, the cost to open one factory to produce chemical equipment or pharmaceutical technology in Vietnam is cheaper than in China by 50%. Similarly, the cost to build an auto manufacturing plant in Vietnam is 40% cheaper than in China.  Foreign investors have sent signals to switch manufacturing into Vietnam.

Looking at the medium term, the picture of foreign investment in Vietnam is bright. The domestic market continued to recover with the forecasting GDP growth for 2015 is 6.1% and increase to 6.2% in 2016.

Therefore, if Vietnam can make good use of opportunities, maximize cost benefits; enhance the skills of workers and improve production technology, Vietnam will benefit in the upcoming shift.

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