BANGKOK, THAILAND: Japanese companies are relocating their production bases to Viet Nam to take advantage of lower operating costs there and avoid the political turmoil here, according to the Japan External Trade Organisation (Jetro).

"Three years ago, investment in Viet Nam [from Japan] was 1.6 billion baht (US$52.63 million). But the figure is up to 3.9 billion baht ($128.28 million) this year," Yoichi Kato, president of Jetro's Bangkok office, said Thursday (6 Dec).

The exodus started late last year when Thai politics turned chaotic, he said.

Some core industries including electronics and automobiles have pointed out that production costs in Viet Nam are now much cheaper than in Thailand. The economy there has also been vibrant for years due to strong domestic demand.

The United Nations has noted that Viet Nam is becoming of the world's best countries for investment along with China, Russia, Brazil, India and the United States.

Japanese companies are primarily concerned about political stability when making an investment decision, so they see Viet Nam as a good place to go, Kato said.

Jetro has organised investment seminars in other countries such as Cambodia and Laos.

The Japan-Thai Economic Partnership Agreement, which recently went into effect, is expected to boost Japanese imports, particularly farm products, while tropical Thai fruits such as durian and mango are expected to penetrate the Japanese market. (The Nation/ ANN)