Vietnam set to expand its share of Japanese software market

TN News

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Vietnamese software companies predict Japan will remain the industry's primary importer this year, with Japan set to reduce the number of contracts it outsources to China, has reported.

News website ICTnews quoted Nguyen Doan Hung, chairman of the Vietnam-Japan IT Cooperation Club (VJC) last January as saying that among the reasons for China's shrinking software exports to Japan have been the rising tension between the two countries over territorial disputes.

Another contributing factor is the relatively high cost charged by China's firms for outsourcing services, which is now 30 percent higher than that of Vietnam.      

Nguyen Thanh Lam, CEO of FPT Software, a subsidiary of Vietnamese technology and telecommunications giant FPT, told on Monday that Vietnam has been presented with tremendous opportunities that it should take advantage of in order to boost its share of the Japanese software market.

Lam said his FPT Software, which has a targeted growth of 30 percent for this year, has suggested to leading Japanese companies that they consider Vietnam to be a hub research and development center, as well as a center for IT services and software outsourcing.  

Vietnam Software and IT Services Association statistics showed that exports to Japan currently account for 35 percent of the country's software export revenues.

Chu Tien Dung, the association's vice chairman told the news website in a November interview that Japan has been a major importer of Vietnam's software for the last 10 years, with the revenues to local firms increasing by 30 percent annually.

The association told the news website that it will organize meetings between software companies from the two nations in June to seek partners and contracts for the domestic companies in an effort to promote Vietnam's exports to Japan.

A survey done by Japan's Information Technology Promotion Agency last year showed that Japanese companies choose Vietnamese partners because they offer low prices for its outsourcing services and have an ample supply of qualified laborers.

The research surveyed 1,100 Japanese IT companies, 31.5 percent of which asserted that Vietnam was still their most-desired partner, followed by India and China with 20.6 and 16.7 percent respectively.  

It revealed that 23.3 percent of surveyed companies said they have placed orders with Vietnamese partners, compared to 17.8 percent three years ago.

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