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IIST Study Mission on SME Promotion in Mekong Region Countries (FY2008) [February 8-15, 2009]

IIST Study Mission on SME Promotion in Mekong Region Countries (FY2008)

Outline


As economic ties with ASEAN/East Asia have developed, the role of the Mekong Region Countries has been gaining importance. Amid increasing expectations of support and cooperation from Japan, IIST organized a “Study Mission on the Promotion of Small and Medium-scale Enterprises (SMEs) in the Mekong Region Countries”. The purposes of this mission were to understand the present state of local SMEs, to promote Japanese SME investment in these countries, and to build counterparts and networks.

Organized by: Institute for International Studies and Training (IIST)
Dates: February 8 (Sunday) - 15 (Sunday), 2009
Place: Socialist Republic of Viet Nam (Hanoi, Hochiminh), Kingdom of Cambodia (Phnom Penh)

Participants


(1)
Experts in small-and-mid scale business
1.Mr. Tatsuya HOSHINO, International Business Advisor of SMRJ, and Research Director of Viet Nam Economic Research Institute (VERI)
3.Mr. Kazuo NISHITANI, Manager of International Division, JCCI

(2)Observer participants from METI
1.Mr. Jun KODA, Counselor of Asia and Pacific Division, METI
2.Mr. Masayuki NAKAYAMA, Deputy Director of Asia and Pacific Division, METI

(3)IIST Members
1.Mr. Tetsuo MIZUYOSHI, Director of International Exchange Dept., IIST (Mission Leader)
2.Ms. Akiko TOYOYAMA, Asia Dept., IIST


Visited Places


-Visit Ministry of Industry and Trade (MITI)
-Opinion exchange with top officials from the Japan Business Association in Viet Nam
-Visit HANOI TAC
-Agency for SME Development (ASMED)
-Viet Nam MITI Strategy Research Institute (IPS-MOT)
-Viglacera Corporation
-Tien Son IZ
SHIHEN VIETNAM Co., Ltd SUMITOMO ELECTRIC INTERCONNECT PRODUCTS (VIETNAM)
-JETRO Hochiminh Office
-Tan Thuan Export Processing Zone
Kyoshin Viet Nam
Daiwa Plastic (Viet Nam) Co., Ltd.
Showa Viet Nam
-Hochiminh Office, Viet Nam Chamber of Commerce and Industry (VCCI)
-Briefing at Council for the Development of Cambodia (CDC)
-Ministry of Industry, Mines, and Energy
-Phnom Penh Office, VCCI
-Courtesy call to ambassador, Japanese Embassy
-Courtesy call to Minister Phavi, Ministry of Women’s Affairs
-Opinion exchange with representatives of companies toured
-Phnom Penh SEZ


Overview


1) Opinion exchange meetings with officials of local government and economic/industry organizations, who are in charge of SME promotion policies
2) Briefing of current situation of SMEs in these countries from representatives of JETRO, JICA experts and the Japanese companies
3) “Seminar on SME Promotion” by Japanese experts (in Hanoi and in Phnom Penh)
4) Visit to several Special Economic Zones in various business fields (plastics, sewing, shoe manufacturing).

In Viet Nam, government and related organizations recognize the importance of promoting SMEs, not only in the sewing and leather industries, but also in the supporting industries that manufacture auto parts and electric components. However, the study mission realized that there were still various hurdles to be overcome, such as in the area of technology and human resources. Currently the Viet Nam government is drafting new laws and offering technical support needed to assist SMEs. In addition, at each place visited, the experts asked questions concerning the global economic slump and its impact on SMEs in Viet Nam. It is clarified that the consequences would differ according to the industry-those dependent on exports would be the hardest hit (the production rate at one Japanese company had fallen 40% since the beginning of the year), but the repercussions on domestic sales businesses would be small.
In Cambodia, the so-called mom-and-pop/small companies were numerous. At the moment SMEs have not been actively promoted. However, it was apparent that the government bodies and relevant organizations are encouraging to promote SMEs in the future. The expert from the Council for the Development of Cambodia (CDC), Mr. Iwana, explained the various incentives that the Cambodian government was carrying out to entice foreign businesses to the country. To oversee the cultivation of SMEs, Cambodian government established the Small Industry and Handicraft Dept., in 2005 within the Ministry of Industry, Mines, and Energy. Several government officials including Minister Phavi from the Ministry of Women’s Affairs commented that although the government was strengthening efforts to promote SMEs, there were still lack of information, technology, and human resources. They also requested the future assistance and cooperation in this field through mission member’s organizations and Japanese government.

This study mission had the following three concrete outcomes.

(1)The mission members were able to grasp the current circumstances and needs of local SMEs and to anticipate the problems which Japanese companies might encounter as they move into the region. IIST will prepare the report compiling information about the first outcome of this mission and distribute it relevant individuals.

(2)The local representatives (government officials, private-sector SEZ, etc.) received explicit advice from the experts on how to bring Japanese SMEs to the region. In terms of the second outcome, not only were opinions exchanged between various persons, but Japan SME advisor Mr. Hoshino held a seminar and gave lectures based on actual cases in Japan involving SME promotion, including specific advices about encouraging local SMEs. The seminar had an even greater impact on local representatives.

(3)An extensive network was established among local persons involved in future SME promotional policies and representatives from Japanese companies entering the regional markets. The ties forged through the newly built network will likely be strengthened during the “3rd CLMV Young Leadership Program,” scheduled to take place in July 2009.

Throughout the study mission, it was evident that government and business both in Viet Nam and Cambodia were hoping that Japanese SMEs would enter the markets in the future and that the Japanese government help to bring them to the region. IIST intends to utilize the information and network gained through this program to further cooperate with SME promotion in the Mekong Region.


Seminar by experts at HANOI TAC (Hanoi)

Seminar by experts at HANOI TAC (Hanoi)

Visit Agency for SME Development (ASMED; Hanoi)

Visit Agency for SME Development (ASMED; Hanoi)


Visit SHIHEN VIET NAM Co., Ltd (Tien Son IZ, Hanoi)

Visit SHIHEN VIET NAM Co., Ltd (Tien Son IZ, Hanoi)

Visit Daiwa Plastic (Viet Nam) Co., Ltd. (Tan Thuan Export Processing Zone, Hochiminh)

Visit Daiwa Plastic (Viet Nam) Co., Ltd. (Tan Thuan Export Processing Zone, Hochiminh)


Courtesy call to Minister Phavi, Ministry of Women’s Affairs (Phnom Penh)

Courtesy call to Minister Phavi, Ministry of Women’s Affairs (Phnom Penh)

Visit to shoe manufacturer, Tiger Wing Co. (Phnom Penh SEZ)

Visit to shoe manufacturer, Tiger Wing Co. (Phnom Penh SEZ)




International Exchange Dept.

(For the Japanese version of this article)