According to the newspaper, foreign direct investment in Vietnam in 2006 hit a record high, helping to boost the country’s economic growth rate. The paper predicted that Vietnam’s economy will maintain its high growth of over 8 percent in the coming years.

Vietnam’s economic reforms as well as its entry to the World Trade Organisation (WTO) have made Japanese investors more confident about their investments in the country, particularly in Hanoi and other northern localities.

The paper went on to say that more than 70 percent of Japan’s total investment capital in 2006 went to the northern region, while the first wave of Japanese investment flowed into the southern region. Hanoi now has 240 Japanese companies while HCM City claims to have as many as 350.

One of the main reasons for the second inflow of Japanese investment into Vietnam is the strategy “China+1” pursued by Japanese investors to avoid risks they are facing in China. The number of Japanese firms operating is increasing. What has made Vietnam more attractive than China is political stability and cheap labour cost.