HANOI, Jan. 21 (Xinhua) -- In the past decade, foreign investments have
gradually shifted from China to India and the members of the Association of the
Southeast Asian Nations (ASEAN) but ASEAN is not likely to replace China as the
world's top manufacturer, according to Nguyen Huy Hoang, Deputy Director
General of the Institute for Southeast Asian Studies of the Vietnam Academy of
Social Sciences.
In a recent interview with
Xinhua, Hoang said there are several factors as to why the regional grouping,
composed of the new emerging economies, could not replace China as world's top
manufacturer.
Hoang explained that the shift of
the foreign investments to ASEAN is primarily due to adjustments in China's
investment policies towards service-oriented economy or intellectual economy,
focusing on areas with higher added value.
In addition, foreign investors
also want to take advantages of ASEAN's large population, cheap labor, robust
economic growth and increasing number of the middle class--people with high
consumption demand and these are the key factors to boost manufacturing and
investments.
Southeast Asia is emerging as a
dynamic region in economic development, attracting foreign investors and
becoming a favorite destination for international manufacturers.
During the past years, ASEAN
countries still adopted export- based economic development. When ASEAN's major
markets, including the United States and the European countries, faced economic
slowdown,the import demand from those countries declined, Hoang said.
However, ASEAN countries have
adopted timely policies to deal the global economic downturn, maintaining
relatively high growth from 4.7 percent in 2011 to 5.2 percent in 2012. ASEAN's
growth are forecast to reach 5.3-5.5 percent in 2013, with Indonesia topping
the list, followed by Vietnam, the Philippines, Laos and Myanmar.
Hoang said that in recent years,
ASEAN policy-makers have always looked forward to integrating their trade,
finance and related institutions,into what is dubbed a "borderless ASEAN capital
market."
The overarching goal of the
establishment of the ASEAN Community is to create a unified manufacturing
market, where the commodity,capital and human resources can be mobilized freely
among member countries, Hoang added.
However, the ASEAN market of some
600 million people is only half of that of Chinese market, thus in times of
global slowdown, domestic demand in China is definitely much bigger than that
of the ASEAN members combined.
Furthermore, Hoang said, China,
now the world's second largest economy, is one country while the ASEAN market
comprises ten countries with different institutions and policies on how to
attract foreign investments.
"In the coming years, China
will still remain the world's top supplier in both low-technology and
high-technology products," Hoang added.
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