Japanese Firms to Move China Factories to Thailand and Vietnam in 3 Years

< P > < FONT face = Verdana > According to the World Journal of Thailand, the Japan External Trade Organization (JETRO) published a survey report showing that Japanese companies will move their factories from China to Thailand and then to Vietnam in the next three years. The reason why the factory moved to Vietnam is that China "has increased production and labor costs, and it is too risky to put all production skills in one country".

< P > < FONT face = Verdana > As a result, the survey found that Japanese companies have adopted a "China plus one" strategy, setting up production bases in another country besides China to reduce their dependence on China.

< P > < FONT face = Verdana > According to the survey, Thailand is the second most preferred country for Japanese companies to expand their middle and low-end products. Most Japanese companies that want to operate in Thailand believe that the coup in September 2006 will not affect their plans, and that political changes will only have a slight impact on some companies.

< P > < FONT face = Verdana > Japanese companies face risks in Asian countries, including high labor costs in Singapore, "improved legal systems and procedures", "intellectual property protection issues" and "tax issues" in China, and "inadequate infrastructure" in India and Vietnam.

< P > < FONT face = Verdana > Japanese companies expect sales and operating profits to grow 40% in Asia and 20% in Europe and the United States by 2010, the report said.

< P > < FONT face = Verdana > The survey found that 65.4% of Japanese companies plan to expand overseas in the next three years, including sales and production of low-end products. Japanese companies believe that Vietnam and India are the first choice for Asian countries.

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