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Corporate Communications Staff Explores the World

Vietnam, the field where Sumitomo Corporation exerts its Integrated Corporate Strength

  • Vietnam
  • Metal Products Business Unit
  • Transportation & Construction Systems Business Unit
  • Media, ICT, Lifestyle Related Goods & Services Business Unit
  • Food Products
  • Metal Products
  • Transportation

November 2016

Ryotaro Tabe, Mass Media Relations Team, Corporate Communications Department

After joining Sumitomo Corporation in 2009, Tabe was engaged in the operation and management of the company's overseas offices until 2012, when he was sent to London to work as a trainee for two years. In April 2016, he was then transferred to the Corporate Communications Department. He spent his childhood in Australia, and in Japan attended a high school that was famous for its strong baseball team. As a university student, he spent time studying in Thailand and has a good grasp of the Thai language.

To be honest, on a personal level thinking about Vietnam just makes me think of pho, fresh spring rolls, the ao dai national costume and so on. In the world of business, however, Vietnam is gaining attention as having one of the fastest-growing economies among the Association of South-East Asian Nations (ASEAN). As such, Vietnam is of course an important market for Sumitomo Corporation. As one of the largest Japanese integrated trading companies, Sumitomo Corporation is engaged in a broad spectrum of business sectors, including steel products, infrastructure, industrial parks, logistics, transportation systems, chemicals, energy and food.

Recently, I had an opportunity to take a business trip to Vietnam. In the following, I would like to introduce a range of business projects that Sumitomo Corporation is implementing in the country.

Diversified human resources of Sumitomo Corporation Vietnam

Sumitomo Corporation started the business in Vietnamdetail in 1955, more than 60 years ago, by opening a representative office in Saigon (presently Ho Chi Minh City). Currently, Sumitomo Corporation Vietnam, which was established in 2007, has three offices in the country: the Hanoi Head Office, Ho Chi Minh City Office and Danang Office.

I visited the Hanoi Head Office and Ho Chi Minh City Office during my trip. I am now 31 years old, and most of the national staff members whom I met at the offices looked younger than me, and the workplace atmosphere was really freshdetail It's also worth noting that the ratio of female employees is very high at Sumitomo Corporation Vietnam. The company seems to be encouraging the more active involvement of female employees in business even more proactively than Sumitomo Corporation, which itself is implementing a range of measures to support female employees, deeming the promotion of women’s participation in business one of the priority issues in its management strategy (*1).

Sumitomo Corporation has grouped its global bases into four broad regions since 2013, and Sumitomo Corporation Vietnam belongs to the Asia & Oceania region. I made the trip to Vietnam in the company of Masao Sekiuchi, General Manager for Asia & Oceania, who visited two Sumitomo Corporation Group companies located in the suburbs of Ho Chi Minh: one in Dong Nai Province and the other in Ba Ria-Vung Tau Province.

*1Utilization of Human Resources -Promoting Workplace Diversity-

Members of the Hanoi Head Office

Members of the Hanoi Head Office

Members of the Ho Chi Minh City Office

Members of the Ho Chi Minh City Office

Steel service center, which is a source for more value creation

Saigon Steel Service & Processing (“Saigon Steel”) is a Vietnamese steel service center in which Sumitomo Corporation holds a 50% stake and which processes and sells steel products. Sumitomo Corporation has long been engaged in the processing and selling of steel products not only in Vietnam but also in other countries. In Vietnam, Sumitomo Corporation is operating steel service centers also in Hanoi and Danang, and thus has three companies, including Saigon Steel, to cover the entire country in terms of steel service. Saigon Steel is capable of various types of steel sheet processing, including surface treatment, cold and hot rolling and stainless processing. The processed steel sheets are used in a range of applications, including for home electrical appliances, construction materials and automobile components. Saigon Steel makes its money by processing steel products at the request of customers as well as by selling its own products and is doing a roaring trade again this fiscal year. At the plant, I saw coiled steel sheets stacked three layers high and watched Vietnamese employees skillfully operating the cutting and packaging equipment, cranes and other machines.

Saigon Steel has the deals with about 130 companies (both Japanese and Vietnamese), to whom the company is outsourcing processing services or delivering its own products. For Sumitomo Corporation, Saigon Steel is a very important company not only in profit but also in good relations with local blue-chip companies in Vietnam. For the benefit of the entire Sumitomo Corporation Group, Saigon Steel is committed to creating opportunities to provide a range of new services, by responding to changing market needs. The network that Saigon Steel has built in Vietnam gives Sumitomo Corporation a competitive edge in the country.

  • Saigon Steel's plant

    Saigon Steel's plant

  • A range of machines are operated in the plant

    A range of machines are
    operated in the plant

  • Stacked coils, each of which weighs about 10 tons

    Stacked coils,
    each of which weighs about 10 tons

 

Satisfy the Vietnamese appetite with the milling business

After about a 40-minute drive from Saigon Steel, we saw a large pale green building appear in front of us.
This was CJ-SC GLOBAL MILLING ("CJ-SC")(*2) , a manufacturer and seller of flour, baking pre-mix products and others. Owned 51% by CJ CheilJedang Corporation of South Korea and 49% by Sumitomo Corporation, the company launched operation in June 2015. The plant is therefore still new. Sumitomo Corporation's decision to launch the milling business was based on its expectation for increasing demand for flour and flour-related products in Vietnam, where demand for food is growing in line with the increasing population and where it is also expected that the food culture will become more diversified and westernized with the expansion of the middle class. By combining Sumitomo Corporation's accumulated flour sales know-how in the Vietnamese market with CJ CheilJedang's state-of-the-art milling technologies developed for the production of high value-added products, CJ-SC has been rapidly expanding its market share, mainly in the segment of high-end food ingredients of seafood-based and bakeries products. CJ-SC owns eight large silos and its plant has eight stories. Wheat stored in the silos is processed into flour by undergoing cleaning, conditioning, sieving and purifying processes.

The CJ-SC plant has a kitchen on-site, where bread and fried foods are made for tasting, using the flour and pre-mix products manufactured by the plant. CJ-SC is committed to ensuring the quality of its products remains at a high level, which makes it a competitive edge in the local market. CJ-SC also exports its products to other countries in Asia, such as Thailand and Indonesia, and is expanding exports. At present, however, about 90% of its products are consumed within Vietnam. The high-quality products manufactured by CJ-SC will greatly help Sumitomo Corporation get a foothold in the Vietnamese food market, which is a familiar market for general consumers.

In front of the CJ-SC building<br >
The person in the center left is Masao Sekiuchi, General Manager for Asia & Oceania, and the second person from right is Hiroshi Karashima, President of Sumitomo Corporation Vietnam

In front of the CJ-SC building
The person in the center left is Masao Sekiuchi, General Manager for Asia & Oceania, and the second person from right is Hiroshi Karashima, President of Sumitomo Corporation Vietnam

Bread made with fresh flour from the plant tastes delicious even without jam or butter

Bread made with fresh flour from the plant
tastes delicious even without jam or butter

  • Crushing wheat with a roller mill

    Crushing wheat with a roller mill

  • Grains of wheat are sieved by large sifters

    Grains of wheat are sieved
    by large sifters

  • Purified by removal of bran

    Purified by removal of bran

 

*2Establishing a Flour Business Joint Venture in Vietnam
 

Ho Chi Minh City Metro Line 1

On the next day, I made a tour of Ho Chi Minh City, which seemed to be developing impressively, with more commercial facilities and restaurants than Hanoi, the Vietnamese capital. This summer, Takashimaya opened a store in Ho Chi Minh, and I heard that one of the Sumitomo Corporation trainees dispatched to Vietnam was the first to enter the store on the opening day after having lined up outside from the early morning. This trainee is engaged in the project for the Ho Chi Minh City Metro Line 1(*3) , Vietnam's first urban railway, for which Sumitomo Corporation won a contract in partnership with a local general construction company in May 2012.

Traffic infrastructure provides the basis for economic development and plays important roles for further economic development. In particular, for the economically growing Ho Chi Minh City, traffic congestion, accidents and air pollution are giving rise to public concern as motorization progresses, making the improvement of public transportation facilities an urgent necessity for the city. Accordingly, the Ho Chi Minh City Metro Line 1 project is deemed one of the most important projects in the city and is unquestionably also a significant project for Sumitomo Corporation.

The Ho Chi Minh City Metro Line 1 will run for 19.7 km from the Ben Thanh Market in the center of the city to Suoi Tien in the northeast. Sumitomo Corporation is responsible for the construction of the elevated section that extends over 17.2 km (including 11 stations) and a train yard.

I visited the area where Thao Dien Station is to be completed. The station had already been constructed to a level that allowed me to easily imagine the pedestrian flow from the concourse on the second floor to the ticket gate, and to the platform up the stairs. The construction work, which was started in 2012, has been steadily ongoing toward completion in 2020.

Thao Dien Station under construction

Thao Dien Station under construction

The construction of the elevated section has been steadily ongoing

The construction of the elevated section has been steadily ongoing

Contributing to the growth of Vietnam and to business creation in the country

During this business trip, I was able to visit only some of the places where Sumitomo Corporation is implementing projects. Because the company is engaged in a range of businesses across the nation, it can enjoy the benefit of Vietnam's growth not just sporadically but continuously and in a multifaceted manner. This diversified business portfolio provides Sumitomo Corporation with a competitive edge in Vietnam. By organically combining the projects in the versatile business portfolio and demonstrating its integrated corporate strength, Sumitomo Corporation can create more new businesses in the country.

When visiting the sites of our projects and businesses during this business trip, I was impressed by the attitude of the rotating staff engaged in various business projects, who are striving to create new value in Vietnam beyond organizational boundaries as representatives of the Sumitomo Corporation Group. I talked with a lot of my colleagues in the country, who take pride in their jobs and are strongly committed to contributing to Vietnam's growth.

Vietnamese people are generally pro-Japan, and I will be happy if they grow to like Japan even more in the future. To this end, it is important for us to broadly provide them with the kind of value that only Japan can offer, thereby helping more people in Vietnam recognize Japan's good points. I think Japanese companies, including Sumitomo Corporation, have significant roles to play in this regard.

Thanks to the business trip to Vietnam, I was able to powerfully recognize the contributions Sumitomo Corporation is making to the growth of the country in various forms, and that there are employees of the company who are daily striving to serve as a bridge between Japan and Vietnam. Let's keep our eyes trained on the country to see on how Vietnam and Sumitomo Corporation will grow and evolve together toward the future.

Social gathering of rotating staff working at Sumitomo Corporation Group companies in Vietnam. They are doing different jobs for different Group companies but seem to be united as one team.

Social gathering of rotating staff working at Sumitomo Corporation Group companies in Vietnam
They are doing different jobs for different Group companies but seem to be united as one team

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