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Japan, Vietnam agree to strengthen supply chains during Suga’s visit

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In this October 9, 2018 file photo, Vietnamese Prime Minister Nguyen Xuan Phuc delivers a speech at a business forum in Tokyo. (Kyodo)

TOKYO (Kyodo) – Japan and Vietnam plan to agree to facilitate the cross-border movement of medical equipment and other goods when Prime Minister Yoshihide Suga visits Hanoi next week, government sources said on Wednesday. coronavirus.

Suga also hopes to sign an agreement allowing Japan to transfer defense equipment and technology to Vietnam at a scheduled meeting with his counterpart Nguyen Xuan Phuc, the sources said.

Japan relies on imports for much of its medical equipment, with around 80% of its face masks supplied by China. As demand for face masks increased after the COVID-19 outbreak earlier this year, many stores struggled to maintain inventory as domestic manufacturers scrambled to ramp up production.

In order to reduce its dependence on China, Japan provides subsidies to companies which shift their production to Southeast Asia, which is both well placed geographically and capable of providing a workforce. relatively inexpensive work.

Of the 30 companies that have already been chosen to receive the grants, including manufacturers of products ranging from medical gowns to car engine parts, half are considering relocating to Vietnam.

During his visit, Suga is also expected to deliver a speech at the University of Japan in Vietnam, a symbol of the bilateral educational exchanges that opened in Hanoi in 2016 with funding from both governments, the sources said.

The prime minister, who is traveling abroad for the first time since taking office in mid-September, is also seeking a similar deal with Indonesian President Joko Widodo on the second leg of the trip.

The agreement with Vietnam on the transfer of defense equipment and technology would allow Japan to export, among other things, patrol planes and radars, which could help Vietnam better counter the growing territorial claims of the United States. China in the disputed areas of the South China Sea.

Japan already has similar agreements with several countries, including the Philippines and Malaysia, which, along with Vietnam, have disputed claims with China over the strategic waterway through which more than a third of world trade passes.

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