Real GDP growth in the ten ASEAN countries is expected to remain at an average of 6.2% during 2017-2021, private consumption continues to be a large part of their growth. Among the 10 countries, Indonesia leads with a GDP of US$ 932 billion and a relatively stable growth rate of 5%. Cambodia, Lao PDR and Myanmar will continue to catch up, they are expected to have the strongest growth rates of over 7% during the next 5 years.
ASEAN countries show great potential as growing markets, as well as providing a strong production base for the Asian region and worldwide. The ASEAN manufacturing industry is undergoing a process of transformation, influenced by increasing labor costs in China. A growing number of manufacturers have relocated their factories to ASEAN countries in an attempt to reduce production costs and seek new opportunities in emerging markets. Moreover, countries such as Singapore are reshaping their manufacturing through Industry 4.0 Technologies to develop long-term competitiveness in the global market.
However, business environments and leading industrial sectors vary among countries. We also observe substantial uncertainties and challenges within the region, examples are:
- Political tension between countries that could affect international trade and FDI
- Slowed growth in trade over the past 5 years; an increase in non-tariff barriers would impede trade further
- Persistent low interest rates in advanced economies may cause market instability in Emerging Asia
- Plateauing productivity growth threatens long-term growth
- Integration of the ASEAN Economic Community is relatively slow
SAI considers that it is critical for businesses to assess the market from two points of view – both individual countries and specific verticals – before expanding within and into ASEAN countries.
SAI is well-placed to support your business in Southeast Asia with our experienced local staff and strategic partners covering all the countries. Our recent successful cases include:
- Strategy development for digital marketing and e-commerce in Southeast Asia
- Screening for growth opportunities in the specialty chemicals sector
- Labor cost assessment
- Benchmarking competitors general operations, cost of production, and business strategies
- Feasibility study for setting up a production base in Southeast Asia
- Market assessments for specific product groups
SAI has developed a complimentary executive briefing on four selected countries in ASEAN (Thailand, Indonesia, Malaysia and Vietnam). It focuses on:
- Macro economy parameters
- Business environments
- Key highlights of the four countries
For a copy of this executive briefing, please contact Greg Downes, President SAI Asia at: gdownes@saiasia.com, or call +65 6550 9827.