Investment Profile. Japan Investments Profile in Vietnam

Transcription

1 Investment Profile Japan Investments Profile in Vietnam

2 2 Japan Investments Profile in Vietnam

3 Contents Japan Investments Profile in Vietnam... 1 Foreword... 4 VIETNAM... 5 GDP Growth... 6 Population... 6 Financial Health... 7 Key Sector Strengths... 7 Opportunities... 8 Overview of Key Legal Issues VIETNAM- JAPAN RELATIONS Key Japanese Organizations in Vietnam Key Vietnamese Organizations in Japan ODA and Other Government Assistance Key Agreements LNT & PARTNERS PROFILE About Us Our Team Our Lawyers Our Practice Groups Our Rankings Our Awards Our Japanese Clients International Cooperation Our Strategic Partners Appendix Appendix Japan Investments Profile in Vietnam

4 Foreword Japan has historically regarded Vietnam as a critical economic partner, and recent trends in foreign investment from Japan have cemented the growing ties between the two countries. As Vietnam s political landscape stabilizes, its regulatory framework untangles and its rich resources and labor market begin to draw regional interest, the attraction of Vietnam to Japan as an ideal investment landscape is expected to continue to burgeon at a rapid rate. It is, therefore, no surprise that Japan regards Vietnam as a long-term strategic partner. The country s FDI contribution increases almost every single year, making Japan now the largest investor of Vietnam. In addition, the huge Japanese interest in Vietnam is evidenced by the growing FDIs into Vietnam amid waning investments into China. A study by JETRO found that FDIs into the Southeast Asia region from Japan doubled in 2012 yet decreased by 18% in China which suggests that Japanese investors are beginning to shift their investments from China to Southeast Asia, mostly in Vietnam. To ensure this growth continues in the long-term, the Vietnam Government and local businesses have made endeavors to streamline and simplify the processes for Japanese investors to set up business in the country. We hope this profile will give you some insight into why so many Japanese investors have rapidly expanded into Vietnam, and how your business will benefit from also entering this country of opportunities 4 Japan Investments Profile in Vietnam

5 5 Japan Investments Profile in Vietnam VIETNAM

6 GDP Growth Thanks to its strengthening export-oriented economy, Vietnam s GDP has been growing year by year, much of which has been driven by key industries such as manufacturing, electronics and agriculture. Graph compiled with data taken from The World Bank As the Vietnamese Government continues to implement its roadmap of liberalizing the country s economy, GDP growth is expected to continue to remain stable and/or increase. Furthermore, following Vietnam s much awaited entry into the Trans-Pacific Partnership ( TPP ) Agreement in late 2014 or early 2015, which will effectively tear down trade barriers with Vietnam s key trading partners, GDP is expected to grow rapidly with the anticipated increase in exports. Population Vietnam is home to approximately 90 million people and is one of Asia s most densely populated countries. Over 70% of the population resides in rural areas, which rely primarily on agricultural production. Vietnam has a young population, with working-age adults representing over 50% of the population. The younger generation is increasingly aspiring to achieve affluent lifestyles. And with the introduction of jobs and an increase in wages, young people have more disposable income, creating an ideal market for new products and services. This youthful society presents an opportunity to foreign investors, both in terms of potential markets and also in terms of human resources. The youth of Vietnam are better educated than their predecessors and they have the drive to achieve a higher standard of living, which makes them an eager and diligent workforce. 6 Japan Investments Profile in Vietnam

7 Financial Health The Vietnamese Government has taken efforts to curb the country s recent high inflation rates, which have hampered investment progress in the past several years. These efforts have been successful and by the end of 2013, Vietnam s average annual inflation rate stood at 6.60%, the lowest it has been in 10 years. As the Government continues rolling out its fiscal policies to slash inflation, which has decreased further as of early 2014, investor interest is expected to rise and Japanese businesses will benefit from the ensuing economic growth. The Government s efforts to achieve monetary stability have also been successful. The exchange rate of Vietnam s official currency, the Vietnamese Dong (VND), has remained steady over the course of the past couple of years. Investors can take comfort in that the days of instability in Vietnam s economy have passed. A testament to the country s positive financial outlook is the year-by-year increase in the Vietnam Stock Market (VN-Index) and the Government s continued efforts to tackle its number of bad debts. Key Sector Strengths Electronics Manufacturing Vietnam s large supply of low wage workers and favorable tax incentives for the industry have attracted a growing number of foreign companies assembling or manufacturing electronics in the country. In 2013, computer and consumer electronics products and components dominated Vietnam s total exports. Textiles The country also boasts a strong textiles industry and the demand for these products is expected to increase following entrance into the TPP Agreement. Vietnam s liberalization of business lines in this sector has led to unprecedented investor interest to satisfy the growing demand from overseas markets. Growth is expected to jump from 12-13% to 15-20%, reaching 20 billion USD in 2017 and projected to surge to 50 billion USD by Agriculture With over 70% of the population living in rural areas, exports in agriculture remain one of Vietnam s major contributors of GDP. The country s tropical climate and unique geographical location have made it ideal for producing certain crops. Today, Vietnam is 7 Japan Investments Profile in Vietnam

8 one of the world s largest exporters of rice, cashew nuts, coffee and black pepper. Other major exports of the country include seafood, rubber and wooden products. Banking While the Vietnamese banking industry has traditionally been restrictive against prospective foreign stakeholders, the Government has recently passed new regulations that will allow investors to acquire a larger stake in the country s national banks. The loosening of these restrictions is expected to drive further interest in this industry as large infusions of capital will be needed to upgrade the systems, operations and branches of the current commercial and retail banking system. Logistics The growth potential of Vietnam s logistics industry has been expanding as a result of the country s increasing export turnover. Foreign interest in this industry has been supported by recent figures provided by the Deputy Minister for Transport, who cited that local logistics providers are only able to handle 20% of market demand (with the remaining 80% being handled by foreign companies). Tourism For services, Vietnam s tourism industry has attracted some of the largest FDI commitments into the country. In 2012, Vietnam welcomed over 7 million visitors. These figures, which are growing, make tourism a key growth industry driven by strong global and domestic demand. Opportunities While challenges remain in the country s regulatory framework, Vietnam remains an attractive destination for foreign investment not least because of the Government s efforts to open its market to investors. Today, almost all investment sectors in the country are open to foreign investors (many as a result of the WTO commitments) and the rollout of further market openings is expected to take place within the next 1-2 years. On the agenda is also Vietnam s long awaited entrance into the Trans-Pacific Partnership Agreement (TPP), the conclusion of which is expected to considerably drive demand for commodities from the country. It is, therefore, no surprise that in the 2014 ASEAN Business Outlook Survey by the U.S. Chamber of Commerce, Vietnam was ranked as the second most popular ASEAN destination for investment (after Indonesia). As a positive outlook, 85% of survey respondents in Vietnam further expected profits to increase in Japan Investments Profile in Vietnam

9 The total amount of FDI has been increasing since 2011 and it is expected to continue in years to come Total FDI influx into Vietnam (million USD) Total number of FDI projects in Vietnam 15, , , , , , FDI Trend ( ) Total FDI influx into Vietnam (US$ mil.) Total number of FDI projects in Vietnam This positive outlook, which is driven by a stabilizing economy, a liberalization of the market and a dynamic labor force, has placed Vietnam on the radar as an emerging market to watch. 9 Japan Investments Profile in Vietnam

10 Overview of Key Legal Issues Investment Process in Vietnam In 2007, Vietnam acceded to the WTO, which expanded foreign investors access to Vietnamese markets. Vietnam s WTO commitments have drastically altered the investment environment by largely superseding the protective legislation which was one of the greatest challenges to doing business in Vietnam. Since accession, according to the Ministry of Finance, wholly foreign-owned entities have become the most common legal structure for FDI, followed by joint ventures and then BOT, BT, BTA and BCC contract arrangements. Licenses for foreign investors will be largely granted on the discretion of the ministries. The process may take approximately anywhere from 3 months (average time for the service sector) to 12 months (for large-scale projects needing prime ministerial approval). However, there has been a proposal to amend the current Law on Enterprises, which is expected to transform Vietnam into a more investment-friendly environment for investors. In practice, foreign investors in Vietnam are often required to obtain HS codes and investment licenses before commencing their business activities. The proposed amendments will remove these hurdles; instead, foreign investors will only be required to obtain a Business Registration Certificate in the same manner as Vietnamese companies. Moreover, the abolition of HS codes will allow businesses to engage in any business activities (other than those otherwise specifically prohibited such as activities in weaponry and drugs). Restrictions Prior to investing in Vietnam, certain requirements, such as demonstration of financial capacity and industry experience, will generally need to be fulfilled to the satisfaction of the authorities. Furthermore, while investment in a vast majority of sectors in Vietnam is open nowadays, certain sectors will demand for additional conditions to be satisfied. For example, projects in sectors that may have an adverse environmental effect (e.g., manufacturing) will likely require an environmental impact assessment report. FDI approval for special services, such as banking, insurance, finance, and securities, will also be subject to higher scrutiny by the authorities, and satisfaction of more stringent conditions may be needed 10 Japan Investments Profile in Vietnam

11 Taxation There is a double tax avoidance agreement in force between Vietnam and Japan, which allows taxes paid in one of these countries to be offset against taxes payable in the other. Companies are generally subject to the corporate tax rate of 22%, which is applied from January 1 st, 2014 until December 31 st, From January 1 st, 2016 onwards, this tax rate will be lowered to 20%. Investors may also be able to enjoy preferential tax rates (or even tax exemptions) if they satisfy some of the range of eligibility requirements set out under Vietnamese law (e.g., by operating projects in encouraged sectors). Legal Framework However, Vietnamese laws are sometimes vague, ambiguous and inconsistent. This may, at times, lead to inconsistent applications of the law by the authorities. For this reason, we advise prospective investors to consult with the relevant authorities prior to carrying out their investment projects if any regulatory ambiguity or inconsistency arises. For more information on Vietnam s legal landscape pertaining to FDI, please refer to the 2014 IFLR Report by Bui Ngoc Hong, Do Huy and Nguyen Xuan Thuy at Appendix Japan Investments Profile in Vietnam

12 VIETNAM JAPAN RELATIONS 12 Japan Investments Profile in Vietnam

13 Key Japanese Organizations in Vietnam Japanese interest in Vietnam is bolstered by the strong financial and technical support provided by various organizations in the country. These organizations have assisted in providing support, such as official development assistance (ODA), the provision of which has been well-received by the Vietnamese Government. The following key organizations are expected to play a more active role in Vietnam s economic development in the future, which will act as a catalyst for a boost in Japanese investment: 1. Japan External Trade Organization (JETRO) 2. Japan Bank for International Cooperation (JBIC) 3. Japan International Cooperation Agency (JICA) 4. Development Bank of Japan (DBJ) In addition to external support, Japanese investors benefit from the numerous industry groups and associations in Vietnam. Dedicated organizations for the Japanese business community exist to welcome investors into the country and offer services to aid them in their business endeavors. These organizations often exchange dialogue with the Vietnam Government to enable Japanese investors to voice any concerns: 1. Japanese Business Association of Ho Chi Minh City (JBAH) 2. Japan Business Association in Vietnam (JBAV) 3. Japan Da Nang Organization 4. Vietnam-Japan Human Resources Cooperation Center (VJCC) 5. The Japan Foundation Center for Cultural Exchange in Vietnam For more information on these organizations, please refer to Appendix 1. Key Vietnamese Organizations in Japan Japanese investors who are interested in Vietnam may seek information from the Vietnam-Japan Business Association. The Embassy of Vietnam is located in Tokyo. There is also a Vietnamese Consulate General located in Tokyo, Osaka, Fukuoka, Kushiro and Nagoya. For more information on these organizations, please refer to Appendix Japan Investments Profile in Vietnam

14 ODA and Other Government Assistance As part of the Japanese Government s pledge to assist developing countries in various areas including infrastructure and construction, the Ministry of Foreign Affairs established the ODA loan and grant aid program. Vietnam is one of the grateful beneficiaries of the Japanese Government s ODA program and thanks to this assistance, the country has seen the successful completion of major and much-needed infrastructure projects. Some recent projects that are on the way to or have been successfully established through ODA assistance include the following: PROJECT Grants Grant for Next-Generation vehicles Human resource development scholarship Loans North-South Expressway Construction Project Lach Huyen Port Infrastructure Construction Project Thai Binh Thermal Power Plant and Transmission Line Construction Project Grants Grant for medical equipment Aid grant for small and medium-sized enterprises Loans reconstruction of bridges in the Central District Hanoi City Urban Railway Construction Project (Line 1) Climate change support program Combined Cycle Power Plant Construction Project Noi Bai International Airport to Nhat Tan Bridge connecting road Grants North-South Expressway Construction Project Lach Huyen Port Infrastructure Construction Project Loans Afforestation of the coastal sandy area in Southern Central Vietnam Human resource development scholarship E-Customs and national single window for customs modernization project Development of traffic control systems for expressways in Hanoi 14 Japan Investments Profile in Vietnam

15 PROJECT Grants Saigon East-West Highway Construction Project Ho Chi Minh City Water Environment Improvement Project Climate change support program Nhat Tan Bridge (Vietnam-Japan Friendship Bridge) Construction Project Nghi Son Thermal Power Plant Construction Project Ninth Poverty Reduction Support Credit Loans Grants Rehabilitation of small-scale reservoirs in Quang Ngai Province Program for the improvement of capabilities to cope with natural disasters caused by climate change Afforestation of the coastal sandy area in Southern Central Vietnam Human resource development scholarship Two Japanese NGO projects National Highway No. 1 Bypass Road Construction Project Thai Binh Thermal Power Plant and Transmission Line Construction Project Small-Scale Humanitarian Infrastructure Development Project Project to promote energy efficiency and renewable energy Financing of small and medium-sized enterprises Loans Groundwater development in Central Highland Provinces Afforestation of the coastal sandy area in Southern Central Vietnam Improvement of equipment in national hospitals for obstetrics and gynecology Project for reinforcing customs functions at Haiphong Port The Forest Preservation Program 15 Japan Investments Profile in Vietnam

16 Key Agreements The promotion of Japanese investment into Vietnam is facilitated by the strong bilateral investment relations between the two countries. This relationship has been encapsulated by multiple bilateral agreements and treaties. Some key agreements include: 1. The Japan Vietnam Investment Treaty (JVIT) Signed on November 14 th, 2003, came into effect on December 19 th, 2004 The JVIT assigns the most favored nation treatment to both countries. Therefore, Japanese investors can expect to receive equal trade advantages, such as preferential tax rates, to those enjoyed by Vietnamese investors. The JVIT further prohibits adverse behavior that would affect the investment interests of Japanese investors, as well as liberalize and protect their trade interests. 2. The Japan Vietnam Economic Partnership Agreement (JVEPA) Signed on December 25 th, 2008, came into effect on October 1 st, 2009 The JVEPA aims to liberalize and facilitate commodities and services trading between Japan and Vietnam. This aim is implemented primarily by way of a reciprocal removal of a vast majority of import duties and tariffs in the two countries. The JVEPA further provides for other commitments to promote bilateral investment relations, such as the protection of intellectual property and also the prevention of anti-competitive conduct. 3. The Japan Vietnam Joint Initiative (JVJI) Signed on December 4 th, 2003 The JVJI sets out a comprehensive action plan entered into between Vietnam and Japan to boost Vietnam s investment landscape and increase its industrial competitiveness. Under this initiative, the Japanese Government agreed to offer support in the form of ODA to invest in and provide technical support for major infrastructural projects in Vietnam. 4. Japan Vietnam Joint Statement on the Strategic Partnership for Peace and Prosperity in Asia Made in 2011 In a meeting between the Japanese Government and Vietnamese Government in 2011, dialogue was exchanged in order to determine the means for both countries to make a positive contribution to the peace, stability and prosperity of the region. Under the Joint Statement, Vietnam expressed its gratitude for the extensive Japanese contribution by way of ODA, while Japan expressed that it will continue efforts to support Vietnam s economic development by providing technology and expertise. In the energy and natural resources sector, both countries agreed to cooperate in the peaceful use of nuclear energy, as well as develop Vietnam s growing rare earth industry under which Japan will provide financial and technical support 16 Japan Investments Profile in Vietnam

17 LNT & PARTNERS PROFILE 17 Japan Investments Profile in Vietnam

18 About Us LNT & PARTNERS is a leading full-service independently ranked local law firm in Vietnam with offices in Ho Chi Minh City, Hanoi, Hong Kong (affiliate), and San Francisco. The firm is among Vietnam s most prominent, representing a wide range of multinational and domestic clients, including Fortune Global 500 companies as well as well-known Vietnamese listed companies on a variety of business and investment matters. Our Team Our Lawyers Mr. Hong Bui Practice areas Compliance Foreign Investment M&A Mr. Huy Do Practice areas Intellectual Property Dispute Resolution Antitrust/ Competition Ms. Quyen Hoang Practice areas Corporate Employment & Benefits Foreign Investment M&A Dr. Net Le Practice areas Banking & Finance M&A Tax Dr. Tuan Nguyen Practice areas Antitrust/ Competition Bankruptcy Employment & Benefits M&A Dr. Vinh Nguyen Practice areas Dispute Resolution Employment & Benefits Tax Mr. Binh Tran Practice areas Real Estate/ Infrastructure Dispute Resolution Employment & Benefits Mr. Su Tran Practice areas Dispute Resolution Real Estate/ Infrastructure Banking & Finance 18 Japan Investments Profile in Vietnam

19 Our Of Counsel and Senior Advisor Mr. Kiyoshi Hirasawa Practice areas Japan Practice Corporate, M&A Foreign Investment Dr. Sy Chung Pham Practice areas Corporate Compliance Foreign Investment M&A Our Practice Groups LNT & PARTNERS has domain expertise in key legal disciplines organized into five Practice Groups: (i) (ii) (iii) (iv) (v) Corporate Group: Our highly-regarded corporate team regularly handle M&A deals, advise on complicated business licenses, guide investors with their inbound and outbound investments, and navigate regulatory compliance issues (including in matters of competition, labor and taxation) to deliver commercially-practical solutions to our clients. Dispute Resolution Group: Our award-winning dispute resolution lawyers, which include two former judges, have represented major companies in both court and international arbitral proceedings Banking and Finance Group: Our banking and finance team has been at the forefront of millions of dollars worth of financial transactions for large financial institutions, funds, and private companies. Intellectual Property/TMT Group: Our IP/TMT professionals have extensive experience in advising and representing major clients in some of the most complex and high-profile IP related matters in various industries, including biotech, pharmaceutical, electronics and software. Real Estate and Infrastructure Group: Our real estate and infrastructure team has been behind some of Vietnam s largest development projects. 19 Japan Investments Profile in Vietnam

20 Our Rankings PUBLICATION PRACTICE AREAS RANKING YEAR Banking and Finance Leading Lawyers 2013 / 2012 Asia Pacific Legal 500 Corporate/ M&A Leading Lawyers 2013 / 2012 Dispute Settlement Leading Lawyers 2013 / 2012 Tax Leading Lawyers 2013 / 2012 Banking and Finance Vietnam Leading Law Firm 2013 / 2012 / 2011 / 2010 Chambers and partners Corporate/ M&A Vietnam Leading Law Firm 2013 / 2012 / 2011 / 2010 / 2009 Projects, Infrastructure & Energy Vietnam Leading Law Firm 2013 / 2012 International Financial Law Review (IFLR) PLC Which Lawyer? Banking and Finance Notable 2013 / 2012 Mergers & Acquisitions Notable 2013 / 2012 Project Finance Leading Lawyers 2012 / 2011 Recommended Law Firm 2012 / Japan Investments Profile in Vietnam

21 Our Awards Vietnam Deal Firm of the Year 2014 Asia Legal Business, a Thomson Reuters Company, SE Asia Awards 2014 Full Service Law Firm of the Year 2014 Vietnam Intellectual Property Innovators of the Year Vietnam Commitment to Cross-Border Investment Vietnam - Acquisition International Leading Law Firm 2014 Asia Pacific Legal 500 Recognised Firm 2014 International Financial Law Review Corporate Finance Law Firm of the Year in Vietnam 2014 Corporate Intl Magazine Global Award ALB Award Deal Firm of the Year Finalist 2013, 2012 Employer of Choice 2012 ALB 2 nd position Most Trusted Law Firm of the Year Lawyers World Magazine 21 Japan Investments Profile in Vietnam

22 Our Japanese Clients Our partners have had the privilege of representing multiple Japanese clients, from major conglomerates to branch offices, in a broad spectrum of industries and matters, including: 22 Japan Investments Profile in Vietnam

23 International Cooperation The Firm s partners have established strong relationships with attorneys at international law firms such as: US Law Firms European Law Firms Asian Law Firms 23 Japan Investments Profile in Vietnam

24 Our Strategic Partners LNT & PARTNERS has developed an active presence across a broad range of industries through its strategic partnerships with leading industry publications and sector groups, including: Vietnam Investment Review Quang Trung Software City Colliers International Vietnam 24 Japan Investments Profile in Vietnam

25 Appendix 1 Key Japanese Organizations in Vietnam 1. Japan External Trade Organization (JETRO) Hanoi Office Address: Suite , 2 nd Floor, 63 Ly Thai To Street, Hanoi Tel: Fax: vha@jetro.go.jp URL: Ho Chi Minh City Office Address: 14 th Floor, Sun Wah Tower 115 Nguyen Hue Street, District 1, Ho Chi Minh City Tel: Fax: vho@jetro.go.jp URL: 2. Japan Bank for International Cooperation (JBIC) Hanoi Representative Office Address: 3 rd Floor, Sun City 13 Hai Bai Trung Street, Hoan Kiem District, Hanoi Tel: /8935/8936 Fax: URL: 3. Japan International Cooperation Agency (JICA) Primary Office (Hanoi) Address: 16 th Floor, Daeha Business Center 360 Kim Ma Street, Ba Dinh District, Hanoi Tel: Fax: Liaison Office (Ho Chi Minh City) Address: No. 905, 9 th Floor, Saigon Riverside Office Center 2A-4A Ton Duc Thang Street, Ben Nghe Ward, District 1, Ho Chi Minh City Tel: Fax: URL: 25 Japan Investments Profile in Vietnam

26 4. Development Bank of Japan Head Office (Japan) Address: Otemachi Financial City South Tower 9-6 Otemachi, 1-chome, Chiyoda-ku, Tokyo Tel: URL: 5. Japan Business Association of Ho Chi Minh City (JBAH) Address: No. 1407, 14 th Floor, Sun Wah Tower 115 Nguyen Hue Street, Ben Nghe Ward, District 1, Ho Chi Minh City Tel: URL: 6. Japan Business Association in Vietnam (JBAV) Address: Room 605, Sun Red River Building 23 Phan Chu Trinh Street, Hanoi Tel: Fax: URL: 7. Japan Da Nang Organization Address: 4 Tran Phu Street, Da Nang Tel: japandanang@danang.gov.vn URL: 8. Vietnam-Japan Human Resources Cooperation Center Address: No. 91 Chua Lang Street, Dong Da District, Hanoi Tel: /1279 Fax: info@vjcc.org.vn URL: 26 Japan Investments Profile in Vietnam

27 9. The Japan Foundation Center for Cultural Exchange in Vietnam Address: 27 Quang Trung Street, Hoan Kiem District, Hanoi Tel: /7420 Fax: URL: Key Overseas Investment Organizations in Japan 1. Vietnam-Japan Business Association Address: Kanda Higashi Konyacho Chiyoda-ku, Tokyo Tel: Fax: URL: 2. Embassy / Consulate General of Vietnam in Japan Address: 50-11, Motoyoyogi-cho Shibuya-ku, Tokyo 151 Tel: Fax: vnembassy@blue.ocn.ne.jp URL: 3. Consulate General of Vietnam in Osaka Address: Ichinocho Higas Sakai-ku, Osaka Tel: Fax: E: tlsqvn@osaka@mofa.gov.vn URL: 27 Japan Investments Profile in Vietnam

28 4. Consulate General of Vietnam in Fukuoka Address: 4 th Floor, Aqua Hakta Nakasu, Hakata-ku, Fukuoka Tel: Fax: tlsqvn-fukuoka@shirt.ocn.ne.jp URL: 5. Consulate General of Vietnam in Kushiro Address: 4 th Floor, Omachi Building Omachi, Kushiro, Hokkaido Tel: Consulate General of Vietnam in Nagoya Address: 6 th Floor, 1 st Centrair Building 1-1 Centrair, Tokoname0shi, Aichi-ken Tel: Japan Investments Profile in Vietnam

29 Appendix 2 Recent Press Announcements SMTB tie up with a Vietnamese bank December 16 th, Sumitomo Mitsui Trust Bank said Monday it has signed a memorandum of understanding for business cooperation with the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV). Through the partnership with the Vietnamese state-run bank, the Sumitomo Mitsui Trust Holdings Inc. unit will help Japanese firms open local bank accounts, extend dongdenominated loans and give advice on mergers and acquisitions. The collaboration is also designed to provide Japanese clients with more information on the investment environment and regulations in the Southeast Asian country. Sumitomo Mitsui Trust also aims to start trust and asset management services in Vietnam through the BIDV, one of the country s four major state-run commercial banks. The Vietnamese bank has already teamed up with the Japan Bank for International Cooperation and Shinkin Central Bank. 29 Japan Investments Profile in Vietnam

30 Mizuho Bank, Aeon Vietnam tie up for one-stop payment services December 22 nd, HANOI -- Mizuho Bank will establish a partnership with Aeon Vietnam, a subsidiary of Japanese supermarket operator Aeon, to provide comprehensive cash management and payment transaction services for the retailer. The partnership will be the first attempt to offer such services in Vietnam, where management of sales data has lagged, and it is expected to help modernize the country's retail sector. Mizuho Bank and its existing Vietnamese business partner, Vietcombank, will form a comprehensive alliance with Aeon Vietnam on Monday. The two banks will handle all cash management and payment transaction operations for supermarkets directly operated by Aeon Vietnam and for the 120 or so stores in Aeon Vietnam's first Aeon Mall, which will open in January 2014, in Ho Chi Minh City. Sales data will be managed comprehensively through point-of-sale systems to be installed in each store and which are capable of supporting credit card transactions. The banks will also offer other financial services, including direct deposit of employee salaries. The partnership will also issue an Aeon-Vietcombank debit card. To promote sales and enhance customer loyalty, the card will offer such perks as points based on purchase amounts and coupons. 30 Japan Investments Profile in Vietnam

31 Mitsubishi Corporation Constructs Coal Fired Power Plant in Vietnam December 25 th, TOKYO Mitsubishi Corporation (MC), together with Doosan Heavy Industries & Construction of Korea, and Vietnamese partners, Power Engineering Consulting Joint Stock Company 2 and Pacific Corporation, has concluded a contract with state-owned Vietnam Electricity (EVN) to build a coal fired thermal power plant in Vietnam. The plant, located in Vinh Tan in Binh Thuan province, will be composed of two units of 600 MW each with completion expected by 2017 for the first unit and by 2018 for the second unit. Electricity demand in Vietnam is expected to see a remarkable increase of more than 10% per annum in the coming years due to rising population and economic growth. Southern Vietnam in particular, the country's largest economic bloc, which includes Ho Chi Minh City, faces a critical situation in relation to the current imbalance between existing supply and the increasing demand for electricity. There is therefore urgent need for the development of power generation infrastructure in the region. Currently, nearly half the country's electricity supply is generated by hydraulic power, but due to weather and other factors, the need for a more stable source of electricity is ever more present. This project, therefore, is expected to play an important role in preventing the shortage of electricity in the area. Under "New Strategic Direction", its recently released corporate strategy, MC is seeking to accelerate global business development by leveraging the shift towards Asian markets. As building multiple robust and large-scale earnings drivers is also part of the company's business strategy, MC intends to pursue other power generation related business opportunities in the future. 31 Japan Investments Profile in Vietnam

32 Lixil Vietnam opens Dong Nai Factory January 10 th, DONG NAI (VNS) Lixil Global Manufacturing Vietnam, a company under Japan's Lixil group, inaugurated its factory in the Long Duc industrial zone in the southern province of Dong Nai on Wednesday. The factory, constructed on an area of 55ha at a total investment of US$440 million, will produce aluminium and PVC windows and doors for houses, offices, as well as civil and industrial projects. It is the biggest investment project of the Lixil Group in Viet Nam, as well as by Japan in Dong Nai Province. The inauguration marks the end of 20 months of construction. Going forward, the factory will provide jobs for about 2,000 local workers. Dinh Quoc Thai, chairman of the provincial People's Committee, told Vietnamplus newspaper that the number of Japanese investors seeking official approval to conduct business in Dong Nai had been increasing in recent years. In 2013 alone, he revealed, Japanese investors accounted for 30 per cent of the $1.6 billion in foreign direct investment in the province. Thai pointed out that the committee is always willing to support companies and create the best operating conditions for companies to carry out their production and other business activities effectively. The Lixil group of Japan specialises in manufacturing products for the construction industry. Currently, it offers kitchen and bathroom fixtures, such as toilets and bathtubs, under the brand INAX' in Viet Nam. 32 Japan Investments Profile in Vietnam

33 Tokyo-Mitsubishi Bank in Hanoi granted approval to change allocated capital January 25 th, On January 20, 2014, the State Bank of Vietnam (SBV) s Governor issued Decision 79/QD-NHNN on changing capital in the license of The Bank of Tokyo-Mitsubishi UFJ, Ltd. - Hanoi branch. Specifically, the Governor approved the change in the allocated capital recorded in the establishment and operating license No. 55/GP-NHNN of The Bank of Tokyo-Mitsubishi UFJ, Ltd. - Hanoi branch to USD105 million. The Decision shall take effect from the date of signing and is an integral part of the above-mentioned establishment and operating license 33 Japan Investments Profile in Vietnam

34 Tokyo Metro offers assistance to Hanoi Metro February 18 th, Metro/ vov Japan s Tokyo Metro will provide technical assistance and counselling services for the Hanoi Metropolitan Railway Management Board (MRB) to develop and run urban metro lines. A document to this effect was signed in Hanoi on February 18 by Tokyo Metro Co. Ltd CEO Yoshimitsu Oku and MRB director Nguyen Quang Manh. Both sides will exchange information and increase cooperation in human resources for metro projects. Since February 2013 the Japan International Cooperation Agency (JICA) has helped Hanoi carry out a project on technical assistance and increased capacity building of a Hanoi agency to operate and repair metro lines in the city. Tokyo Metro and MRB experts are working on the establishment of an agency to manage and operate the lines in the future. Yoshimitsu Oku expressed hope Tokyo Metro s 90 years of experience will help Hanoi develop modern urban rail lines, giving it a facelift in the coming years 34 Japan Investments Profile in Vietnam

35 35 Japan Investments Profile in Vietnam

36 FOR MORE INFORMATION PLEASE CONTACT: Ms. Quyen Hoang Managing Partner Ho Chi Minh City Head Office Unit 03, Level 21, Bitexco Financial Tower No.02 Hai Trieu Street, District 1 Ho Chi Minh City, VIETNAM Tel: Fax: Hanoi Office Unit 08A, Level 2, International Centre 17 Ngo Quyen Street, Hoan Kiem District Hanoi, VIETNAM Tel: Fax: Mr. Huy Do Partner huy.do@lntpartners.com San Francisco Office 101 California Street Suite 2710 San Francisco, CA USA Tel: Fax: Hong Kong Office (affiliate) Two International Finance Centre Level 19, 8 Finance Street Central, Hong Kong, CHINA Tel: Fax Japan Investments Profile in Vietnam