Vietnamese expats increasingly shun Japan on falling yen, inflation

The engineer is only waiting to repay the VND200 million (around $8,497) his parents borrowed so that he could go to Japan to work.

He subsisted on vegetables, eggs and instant noodles for the past few months as the prices of everything from groceries to electricity rose sharply.

“I used to spend 10,000 yen (US$70) for my weekly groceries, but now it costs 15,000 yen,” he says.

His monthly electricity bills used to be around 20,000 yen during winter, but last time he had to pay twice that. Meanwhile, average salaries in Japan have not risen for the past 20 years, he says.

“Eating is a luxury now, and I have to go shopping only on days that supermarkets have promotions.”

A shopper (L) checks items inside a shoes shop in Tokyo, Japan. Photo by Reuters

Europe and the U.S. raised interest rates sharply even as the Japanese central bank maintained a negative interest rate despite inflation, causing the yen to plummet against the euro and dollar.

The yen in fact fell to its lowest level in 20 years last year.

All this means Japan is no longer an attractive place for Vietnamese expatriates and students.

“My salary used to be equivalent to VND29 million, but that dropped by around VND7 million,” Ngoc says.

After house rent and other monthly bills and various taxes, he says he is able to save only around VND14 million a month, insufficient to pay the debts.

“My parents complain about why I send so little money and why I have not been able to repay the debts after working in Japan for almost a year.”

He is only waiting to settle the debts before returning to Vietnam like “eight out of ten people” he knows.

Tien has just returned to Vietnam from the Japanese city of Nagoya after studying and working there for four years.

He too points to the decreasing value of the yen as his reason for returning. His monthly salary used to be equivalent to around VND35 million before the pandemic, but fell to VND30 million this year.

His old company went bankrupt, and he had to work part-time at a bakery. When he first started, there were around 20 other Vietnamese.

“They all returned to Vietnam,” he says.

As the only Vietnamese worker in the bakery, he often felt lonely and disliked the fact that the supervisor often checked on him and his work. So, after a while, he decided to quit.

He stopped working on March 16, and on April 16 he was back in Vietnam.

Trinh Quang Thieu, director of TQC Human Cooperation and Trading company, says the yen’s decreasing value is making Japan less attractive to Vietnamese, who now prefer to go to South Korea and Europe to work instead.

That is also what Ngoc is considering if his job as an appliances service technician is not good enough.

“Many of my friends have gone to Australia to work as apple or grape pickers,” he says. “They say they can save around VND80 million a month, and all they need is a college degree or equivalent.”

Tien is planning to open a small business, possibly a drugstore, using the VND500 million he saved over four years in Japan.

Meanwhile, the Japanese government has been working on attracting foreign talent with policies that allow people with high salaries to apply for a permanent residence after one year in the country and graduates from elite universities around the world to stay in the country for two years to look for work, Nikkei Asia reported.