Source: Vietnam Economic News - 09:42 05/07/2013

(VEN) - With a young workforce and a large market Vietnam has great potential to develop support industries, according to Charge d'affaires at the Japanese Embassy in Vietnam Hideo Suzuki who spoke to Vietnam Economic News’ Tat Binh.

What do you think about Vietnam’s potential to develop support industries?

I think that Vietnamese support industries have great potential for development and investment attraction just because Vietnam has a big population of about 90 million including a young workforce, which offers good opportunities for development of support industries.

Foreign Direct Investment (FDI) in Vietnam has been fairly stable in recent years, and the demand for components and accessories has increased providing conditions for development of support industries.

What does Vietnam need to do to attract investment in the sector?

Firstly, to develop support industries Vietnam needs to make its policies more transparent in order to clarify top support industries for development in the future and to set directions for investment in these sectors. The Vietnamese Government also needs to enhance dialogue with business and international communities to resolve their problems during their investment in support industries.

Japan has strongly developed its support industries. What experiences could you share with Vietnam?

Japan’s experiences show that most small and medium-sized enterprises (SMEs) have invested in the sector. To encourage SMEs to invest in support industries Vietnam needs to apply incentive policies including proper financial solutions to meet the need of SMEs. However, it is also vital to make policies simple and transparent to attract SME investors in support industries.

Japanese businesses are very interested in Vietnamese support industries. What should be done to attract them?

Two things should be done to boost Japanese investment in Vietnamese support industries. Firstly, the governments of the two countries need to boost cooperation in training human resources and job guidance for Vietnamese workers. Secondly, the Vietnamese Government, ministries and sectors need to enhance dialogue to apply sound policies to promote Japanese investment in Vietnam. The more Japanese businesses invest in Vietnam, the higher the demand for components and accessories will be. As a result, many more Japanese businesses will invest in support industries in Vietnam to meet the demand. Once these industries grow, they will benefit both Japanese investors and the Vietnamese economy.