Japan’s Fukui prefectural government plans to invest in the garment and functional textiles industry to expand its business in Thailand for which they have entered into an agreement with Thailand's Industry Ministry, said Arthit Wuthikaro, the ministry's director-general for the development of industrial promotion.

The total value of investment from Fukui in Thailand amounts to 10 billion baht with 28 companies operating 11 factories.

The agreement is part of Japan's policy to promote and support the overseas expansion of small and medium-sized enterprises (SMEs), especially in strategic industries.

Functional textiles refers to materials widely used in the auto and aviation industries for safety facilities, tyre reinforcement and air and thermal insulation.

SMEs from Fukui have seen the potential to use Thailand as a production base and Asean shipment hub. Their major targets include Myanmar, Laos, Vietnam, Indonesia and Cambodia.

Fukui is the eighth province to sign a memorandum of understanding (MoU) with the Thai government following Saitama, Yamanashi, Totori, Akita, Shimane, Kawasaki and Ichi.

Minamiso and Fukuoka prefectures are expected to sign MoUs with Thailand in January.

Apart from government support for Japanese SMEs, Fukui governor Nishikawa Issei has called for the exchange of business information in a bid to strengthen their channels in the local market.

Mr Issei added that Japanese investors liked to do business in Thailand not only because of the country's position at the centre of Asean but because they have good impression of living in Thailand.