The Japanese Government is teaming up with domestic companies to build, operate
and maintain infrastructure facilities in Asia and other emerging markets,
including Vietnam , a local daily reported.
Japan will carry out three
infrastructure projects worth 75 billion yen in total in Vietnam as their first
such undertaking, the Nikkei daily said.
The three projects, which are
expected to be officially awarded by the Vietnamese government as early as next
month, include the construction of a water system covering all over Hanoi by NGK
Insulators Ltd. and Fuji Electric Holdings Co.-affiliated Metawater Co.; the
installation of intelligent transportation systems on a highway linking Hanoi to
Ho Chi Minh City by Central Nippon Expressway Co., formerly part of the
now-defunct Japan Highway Public Corp.; and the construction of a biomass power
plant on the outskirts of Ho Chi Minh City by Electric Power Development Co.
(J-Power).
For its part, the Japanese government will offer trade
insurance and other support in case payments by Vietnam and other host countries
are delayed or suspended. It could also offer insurance covering projects as a
whole, including operations and upkeep.
Japanese firms' involvement in
infrastructure projects in Asia and elsewhere has until now been limited mainly
to construction or supplying materials. They see getting involved in operating
and maintaining facilities as a source of stable long-term earnings.
Since it believes that Japan 's environmental technology can be used in
a wide variety of fields, the government plans to help Japanese companies win
bids to develop infrastructure. It will focus on nuclear and energy-saving
thermal power plants, water systems, railways, recycling operations,
telecommunications and the like.
It will draw up guidelines containing
strategies to help Japanese firms win infrastructure orders over the next decade
or so and will consider providing a few hundred million yen in support to
Japanese consortiums.
According to Nikkei daily, around 2 percent, or
some 1 trillion USD, of the world's gross domestic product is spent each year on
constructing and maintaining infrastructure, according to the Ministry of
Economy, Trade and Industry. With infrastructure demand to balloon in emerging
markets, such spending will total an estimated 41 trillion USD over the 25 years
from 2005./.