Japanese electronics maker Mitsubishi will invest US$8 million (260 million baht) in its first production plant in Laos, reports said Wednesday.
MMC Electronics Laos Co signed a lease with an industrial park on the outskirts of the capital, the Vientiane Times reported.
Construction of the plant, which will produce thermostats and temperature control equipment for air conditioners, refrigerators, rice cookers and cars, is to begin immediately and be completed by March 2015, the state-run newspaper said.
MMC representative Naoyuki Ochi said parent firm Mitsubishi decided to invest in Laos to enlarge its local production capacity for the Southeast Asian market, which is largely a free-trade area.
“Laos has a guaranteed electricity supply and it is also has a land link so we are able to send our goods to Thailand, Vietnam and China,” Mr Ochi said.
Japanese investment in Laos reached $406 million last year, up 15% year-on-year.
Surging labour costs in China, especially in major cities, and Thailand’s devastating floods of 2011 were key factors behind the move to increase investment in Laos, according to the Japan International Cooperation Agency.
The Japan External Trade Organisation, which assists Japanese companies in overseas operations, plans to open an office in Vientiane this year.
Although still ranked among the world’s least-developed countries, landlocked Laos’s economic growth rate has exceeded 7.5% since 2010, according to the Asian Development Bank. It projected 7.3% growth this year, compared with 7.6% last year.
Source: Bangkok Post