Over half of Japanese businesses in Vietnam and India have plans to expand their in-country operations, a recent survey showed, in a sign of the shift towards reducing reliance on China as a production base in what is known as a “China Plus One” strategy.
In the online survey conducted in December by Japanese staffing firm Pasona Group, 57 per cent of Japanese companies in Vietnam and 55 per cent in India said they would expand operations in the host countries, compared with the average of 39 per cent among all 11 countries and regions polled.
Of the 818 companies polled, 67 per cent said they planned to keep the current level of their bases and operations in the 11 economies.
Twenty per cent said they planned to add and strengthen functions of their bases as regional headquarters, partly due to difficulties in making business trips to and from head offices in Japan amid the coronavirus pandemic, the survey said.
With Southeast Asian countries and regions hit hard by the pandemic, 30% of Japanese companies in Thailand, 28% in Malaysia said they had downsized posted staff or planned to do so within the next three months. The average across all respondents was 16%.
