Vietnam is expected to attract 15 Japanese firms of different sizes that will receive Japanese government’s subsidies to shift manufacturing plants out of China to diversify its supply chain.
Manufacturing semiconductors at MTEX - a Japanese invested company in Vietnam (Photo: Cao Thang)
The Japanese Ministry of Economy, Trade and Industry (METI) has recently unveiled a list of 87 firms that will receive JPY 70 billion (US$653 million) to implement the scheme, according to Nikkei Asian Review.
Thirty firms will shift production to Southeast Asia, including Vietnam and Laos, while the remaining 57 firms will head to Japan.
The shifting scheme aims to reduce Japan’s reliance on China and build resilient supply chain, according to Nikkei Asian Review.
Meanwhile, the Japan External Trade Organization (JETRO) made a detailed list of 30 Japanese firms that are to move their plants from China to Southeast Asia, with half of which heading to Vietnam.
Of the 15 firms, six are large companies and the remaining nine are small and medium-sized enterprises.
Most of the firms manufacture medical equipment while the rest produce semiconductors, phone components, air conditioners or power modules.
Notably, one of them, Hoya Corporation, which manufactures hard-drive components, is expected to move to both Vietnam and Laos.
The Japanese government earmarked JPY220 billion in the fiscal 2020 supplementary budget to support its companies to move plants to Japan. Of that amount, JPY23.5 billion was set aside to promote the diversification of production sites from China to Southeast Asia.
Japan was Vietnam’s fourth largest investor in terms of registered capital last year after the Republic of Korea, Hong Kong and Singapore.
Vietnam is considered an ideal destination for attracting foreign direct investment after the country has controlled the novel coronavirus (COVID-19) pandemic. The country has gone through more than three months without locally transmitted infections. VOV
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