Visitors at an exhibition of Japanese agricultural products in Ho Chi Minh City on December 6, 2015. Photo credit: VnExpress
A group of 32 Japanese agricultural businesses are set to visit Vietnam this week for a market survey, seeking opportunities to either do business with local companies or set up their own operations here, local media reported on Monday.
Companies from Japan have been showing their interest in the local agricultural market this year.
On Sunday six major companies in the Japanese agricultural sector showcased their products such as seeds, fertilizers and machinery at an exhibition in Ho Chi Minh City.
Junichi Kozuka, chairman of clean soil producer Hanagokoro, told Tuoi Tre that Japanese producers are seeking to boost their exports as the Japanese yen has weakened. Besides, with an aging population, it is more difficult for Japan to maintain agriculture activities so expanding overseas is a good option, he said.
With many regions whose climate is similar to Japan's, Vietnam has caught the attention of many Japanese businesses, he was quoted as saying.
Yasutoyo Murakami, chairman of fertilizer producer Hyponex Japan Corporation, said in the newspaper that Vietnam will be its base in the Southeast Asian market and that it is looking for a location to establish a factory here as part of its cost cutting strategy.
Early this year at least two Japanese companies publicly expressed their intentions to set up businesses in Vietnam.
Vegetables and poultry
Showa Denko K.K., which runs a rare earth metals manufacturing company in the northern province of Ha Nam, received an approval from the local authority to operate a clean vegetable farm on a one-year trial basis in April, news website Saigon Times Online reported.
ISE Foods Inc., a poultry business known for egg and chicken production, asked Ho Chi Minh City's authority to recommend local companies which are interested in collaborating with it in setting up poultry farms here, it said.
An unnamed analyst was quoted as saying in the website that Japanese businesses' increasing interest in Vietnam is resulted from free trade agreements which the countries have recently signed with regional economies.
The Trans-Pacific Partnership (TPP), a trade bloc that the two countries are looking to enter along with another 10 nations, is also expected to open Vietnam's agricultural market more with more tariffs to be removed, according to the expert.
Vietnamese government has been looking for ways to attract more foreign investors in agriculture, which is long considered as an underperformer in attracting capital inflows.
In the latest effort, the agriculture ministry is drafting a policy supposed to give preferences such as tax incentives and low land rentals to foreign-invested projects, the government website reported last week.
As of August this year, 512 foreign projects were active in Vietnam with a total registered capital of over US$3.34 billion.
That accounted for less than 3.1 percent of the total number of FDI projects and 1.35 percent of the total investment pledges, according to the website.