Thai firms encouraged to step up Japan investment
Japan is seeking to attract more Thai investment through the recent accord signed during the visit of Prime Minister Prayut Chan-o-cha.
The memorandum of cooperation (MoC) signed by the countries is likely to pave the way for more Thai companies to invest in Japan, said the Japan External Trade Organization (Jetro).
The MoC became effective immediately on Monday when Gen Prayut was on an official visit to Japan. It will last about one year and be automatically renewed unless Thailand or Japan wants to amend it.
“Among Asean countries, Thailand’s direct investment in its neighbouring countries has been growing substantially. However, Thai investment in Japan is still at an early stage, so there is room to grow,” said Masayasu Hosumi, Jetro’s Bangkok president and Asean chief representative.
“We invite Thai companies into Japan and hope that tightening the relationship between the two countries will help increase investment.”
According to Jetro’s data, Thailand started investing in Japan in 1998 when investment value was only US$3 million. The figure rose to $40-80 million over the next decade and has been at $100-130 million in recent years.
Between January and November 2014, Thai investment in Japan reached $90.8 million. That was well above Japanese investment in Thailand of only $3.48 million in the same period.
The move to push ahead with the MoC was one of Japan’s strategies to revitalise its gloomy economy by encouraging foreign investors to move into the country.
Under the MoC, Thai companies would apply to the Joint Standing Committee on Commerce, Industry and Banking, which would cooperate with Jetro in evaluating whether the company would qualify to get Jetro assistance to enter the Japanese market.
Jetro said it would also set up a one-stop service to provide information on how to do business in Japan as well as provide facilities and advice to Thai companies that want to invest there.
Mr Hosumi said: “There are no specific investment criteria set for Thai companies that want to invest in Japan. Jetro welcomes both large and small companies to come and invest in Japan.”
Although Jetro did not specify which sectors would get favourable treatment and said it welcomed all investment, it noted that Thailand had expertise in sectors such as food, energy and hospitality.
Jetro also sees tourism as a high-potential sector because many Thai tourists visit Japan each year, representing the largest group of Asean visitors.
Jetro mentioned two Thai businesses that have successfully set up operations in Japan. Datamax Co is a consultancy for Japanese businesses seeking ways to invest in Thailand, while Textile Gallery is a marketing office for Thai garment companies.
Jetro plans to hold a seminar for Thai businesses by the second quarter to encourage more investors and to find out suitable sectors. “We hope to see more investment after that,” said Mr Hosumi.