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NEC, Sumitomo to aid Vietnam satellite project

Japanese team seeks to step up expansion into emerging countries


NEC aims to break into emerging markets by offering low-cost satellites. (Source:

TOKYO — NEC and Sumitomo Corp. will soon sign a contract worth 19 billion yen ($170 million) for a satellite launch project in Vietnam.

The Japanese team will handle one of the two Earth observation satellites Vietnam plans to launch, and intends to bid for the other project as well. The Southeast Asian nation has suffered from typhoon-induced floods in recent years.

The government-backed Japan International Cooperation Agency is expected to support the NEC-Sumitomo team by providing a yen loan. The satellite launch is scheduled to take place in fiscal 2020. A newly developed NEC satellite was adopted thanks in part to its cost advantage —  about 80% cheaper than comparable models.

This is the first time for a Japanese company to win a satellite launch project in Vietnam and the first overseas order for NEC.

NEC’s annual sales from its space business — focused on the domestic market — come to about 40 billion yen. Sumitomo’s sales in the field total about 2 billion yen. They hope to use the Vietnam project as a steppingstone for expanding into emerging countries.

Emerging nations in Southeast Asia and Latin America increasingly seek to own satellites as their economies develop. They face a wide variety of needs, such as improving communications infrastructure and responding to natural disasters.

NEC and Mitsubishi Electric are Japan’s major satellite manufacturers, but their presence in the global arena is miniscule. U.S. and French companies dominate the global market for commercial geostationary satellites, with Mitsubishi Electric holding a mere 2% share.