Vietnam has pledged to create ‘the best opportunities’ for Japan to increase investments in real estate and infrastructure.
Addressing the 10th Mekong-Japan Summit in Tokyo that opened Tuesday, Vietnamese Prime Minister Nguyen Xuan Phuc said the country would provide the best opportunities via new policies for Japanese firms to invest into Vietnam’s real estate and infrastructure.
He highlighted the need for building houses for manual laborers and the poor; large-scale urban planning; applying new technologies and materials for construction projects.
Japanese real estate firms expressed their desire to boost investments in Vietnam, more specifically, to support Vietnam’s urban planning by expanding urban areas and large-scale supermarkets to new cities and districts, as well as integrating public transport systems like trains or buses into urban settings.
In another business discussion with Japanese financial firms on the same day, Phuc called for Japanese firms to become Vietnam’s strategic partners in the restructuring of state-owned firms and creating new, globally competitive firms.
He also encouraged Japanese investors to acquire Vietnam’s weak banks in order to modernize the country’s banking and financial system.
The Mekong-Japan Summit, held since 2009, is an annual summit that aims to strengthen the relationship between Japan and the Mekong countries and promote sustainable development of the Mekong region.
This year, the summit is being attended by Japanese PM Shinzo Abe, Vietnamese PM Nguyen Xuan Phuc, Cambodian PM Hun Sen, Laotian PM Thongluan Sisoulith, Burmese State Counsellor Aung San Suu Kyi and Thai PM Prayut Chan-o-cha.
Japan is Vietnam’s fourth largest trading partner with a combined trade turnover of $33.4 billion in 2017.
The country is also Vietnam’s second largest foreign investor in terms of pledged direct investment capital, with more than 1,600 projects worth $42 billion licensed by the end of last year.
Traditionally focusing on investing in manufacturing, a big chunk of Japan’s direct investment in Vietnam in the last two years has been channeled into the real estate sector. The country is now one of the biggest foreign investors in Vietnam’s real estate development, mostly in the housing segment.
Vietnam’s infrastructure development, especially the government’s plans for building and expanding airports and seaports like projects to develop Long Thanh International Airport and a high-speed North-South railway, have attracted special interest from Japanese companies.
Japan is also the largest official development assistance (ODA) provider to Vietnam.