According to the Japan External Trade Organization (Jetro), Japanese businesses in Vietnam have faced with difficulties in seeking material sources from local market.
The material and component purchase ratio of Japanese manufacturers in Vietnam is 33.2 percent, lower compared to 66.2 percent in China, 54.8 percent in Thailand and 43.1 percent in Indonesia and 40.7 percent in Malaysia.
They therefore have to import materials and components from Thailand and China for local assembly, especially in the automobile industry.
The most important thing which Vietnam needs to do is to develop local support industry. Japanese businesses should assist their local partners to increase price competitiveness and develop material supply sources.