business outlook survey of 860 executives in asean and their perspectives on aec

2015 ASEAN Outlook

2 2

Source: ASEAN Economic Community (AEC) Symposium, Permanent mission of Thailand to ASEAN

3 3

ASEAN Outlook 2015

866 Respondents from 6 core ASEAN countries Which country are you based in?

Malaysia, 23% (196)

Indonesia, 20% (177)

Singapore, 20% (176)

Thailand, 20% (170)

Vietnam, 11% (96)

The Philippines, 6% (51)

ASEAN Outlook 2015

4 4

…from a wide range of industries Which of the following best describes your industry?

Consumer Goods 13%

Automotive 11%

Healthcare 8%

Banking, Finance and Insurance

8%

Information and Technology

5% Industrial

5% Agriculture

5%

Media and Entertainment

5%

Energy 4%

Construction 4%

Retail and Real Estate

3%

Corporate Services

3%

Travel and Logistics

2%

Other (please specify)

24%

ASEAN Outlook 2015

5 5

…with a large proportion of senior executives Which of the following best describes your job title?

Manager, 26% (225)

Regional/Senior Manager, 16%

(141)

Vice President/General Manager/Head,

16% (138)

Director, 14% (120)

Other, 13% (115) CEO/CIO/CFO/President/Managing Director/Country Manager, 15% (127)

ASEAN Outlook 2015

6

ASEAN Outlook 2015

AEC is perceived to be beneficial to most companies

7%

25%

4%

0%

Very Positive

Positive

No difference

Negative

Very Negative

Answered: 668

What impact do you think the implementation of AEC will have on your company?

“A Free (trade) Zone in Asean (with) no visas and no tax would give us a lot of opportunities to do business with Indonesia, Singapore, Philippines... It (will) change our company a lot.” Agricultural sector CEO, Vietnam

56%

Even though we believe that AEC is a move in the right direction, we don't believe that there will be significant positive developments before 2020. “ Automotive sector Vice President, Singapore

7

Answered: 668

Especially for sectors such as Infrastructure, retail and telecom

5%

14%

17%

18%

19%

21%

27%

31%

32%

Other (please specify)

Energy

Construction

Healthcare

Automotive

Agriculture

Telecommunication

Retail

Infrastructure

Which sectors do you think will benefit most from the implementation of AEC?

“ASEAN has 3 paths to prosperity: urbanization, greater FDI flows ; infrastructure spending growth” Finance sector Vice President, Malaysia

8

Answered: 668

“Singapore can become the "New York of Asean", (according to Foreign Minister K. Shanmugam) … to clarify misperceptions that the AEC will result in jobs being lost, and put small and medium-sized firms at a disadvantage. “ Straits Times, 6 March 2015

Singapore to benefit most from AEC

2%

4%

10%

10%

17%

18%

24%

30%

31%

36%

Brunei

Laos

The Philippines

Cambodia

Myanmar

Malaysia

Vietnam

Indonesia

Thailand

Singapore

“Our largest most recent investment is a new and bigger regional headquarters in Singapore with production & logistic improvements” Construction sector Director, The Philippines

Which countries do you think will benefit most from AEC?

9

ASEAN Outlook 2015

Indonesia, Vietnam and Thailand are expected to be the biggest markets for growth, but line managers also think Myanmar will be important

Manager’s Perspective CEO’s Perspective

2%

5%

14%

20%

21%

22%

24%

26%

37%

Brunei

Laos

Cambodia

The Philippines

Malaysia

Singapore

Myanmar

Vietnam

Thailand

Indonesia

1%

8%

10%

13%

15%

16%

21%

32%

49%

Brunei

Laos

Malaysia

Cambodia

Singapore

Myanmar

The Philippines

Thailand

Vietnam

Indonesia

Answered: 215 Answered: 87

Which ASEAN countries are likely to be a significant growth market for your organisation in 2015?

10 10

c

Managers vs. CEOs Perspectives

11

ASEAN Outlook 2015

The rise of the ASEAN corporation?


12%

13%

20%

26%

28%

All of the above

None of the above

Small and Medium-sizedEnterprises (SMEs)

Large domestic companies

Global multinationals

Large pan-ASEAN companies

5%

13%

15%

24%

44%

All of the above

None of the above

Large domestic companies

Small and Medium-sizedEnterprises (SMEs)

Global multinationals

Large pan-ASEAN companies


Which companies do you think will benefit the most from the implementation of AEC?

Our biggest challenge is the restriction by ASEAN country governments hampering growth of multinationals” Retail sector manager, Malaysia

1%

12

ASEAN Outlook 2015


3%

8%

15%

15%

20%

32%

Freer flow of capital

Freer flow of services

Freer flow of skilled labour

Stronger regulatory andoversight framework

Freer flow of investment

Freer flow of goods

Potential to enhance customerbase from cross-border sales

4%

8%

10%

10%

13%

26%

28%

Freer flow of capital

Freer flow of services

Freer flow of skilled labour

Freer flow of investment

Stronger regulatory andoversight framework

Freer flow of goods

Potential to enhance customerbase from cross-border sales


“Availability of local talent and regulatory factors are some of the challenges to growth. Will this be partly addressed by AEC? Likely..“ Construction industry director, Singapore

Increased sales and the free flow of goods are expected from AEC What do you see as the biggest benefit for your company from the implementation of AEC?

7%

13

ASEAN Outlook 2015

Most executives think they have a good understanding of what AEC entails

6%

14%

29%

43%

9%

Very unfamiliar

Somewhat unfamiliar

Neither familiar nor unfamiliar

Somewhat Familiar

Very familiar

Answered: 615

How familiar do you think your regional senior staff are about the benefits of the AEC?

“A survey by the Institute of Southeast Asian Studies found that 55 per cent of some 380 firms polled across the region were not aware of the AEC. And Singapore companies had the highest level of ignorance - at 86 per cent.” Edmund Sim, AEC Blog, June 4 2014

14 14

Managers vs. CEOs Moving forward

15

ASEAN Outlook 2015

How do you feel about the economy over the next 12 months?

16

10%

62%

27%

1%

8%

49%

38%

4%

Very optimistic

Quite optimistic

Not very optimistic

Not at all optimistic4%

38%

49%

8%

How do you feel about your country’s economy over the next 12 months?

Answered: 225 managers Answered: 90 CEOs

49%

CEOs (90)

Managers (225)

“We expect Asean countries will achieve the same business size as China in the near future”

Automotive sector Regional Manager, Thailand

17

1%

2%

0%

6%

12%

47%

32%

1%

1%

5%

9%

30%

35%

18%

Shrink by more than 10%

Shrink by 5-10%

Shrink by 1-4%

No change

Grow by 1-4%

Grow by 5-10%

Grow by more than 10%

18%

35%

30%

1%

9%

5%

1%

Thinking about 2015, what are your expectations for your local office’s revenue results compared with 2014?

Answered: 225 managers Answered: 90 CEOs

1% CEOs (90)

Managers (225)

“We have made several significant investments in ASEAN during past 3 years, and expect to continue

to do so” Chemical sector Vice President, Singapore

18

ASEAN Outlook 2015

Is anything holding you back from growth?

19

ASEAN Outlook 2015

Managers feel their local economy will restrict their growth. CEOs think the poor skills of their staff are holding them back


8%

14%

18%

20%

36%

36%

52%

Nothing

Restrictions being enforced byparent company

Lack of suitably qualified staff

Lack of investment from thehead office

World economy

Government restrictions

Local economy

9%

14%

26%

29%

36%

39%

Restrictions being enforced byparent company

Nothing

Lack of investment from thehead office

World economy

Government restrictions

Lack of suitably qualified staff

Local economy


Is anything holding you back from growth?

The lack of skilled workforce is one of the biggest problems for investing companies. Automotive sector Vice President, Singapore

20

ASEAN Outlook 2015

Which of the following regional trends do you think will have the biggest impact on your country in 2015?

21

ASEAN Outlook 2015

The rise of the US$ and cheap oil are expected to have a big impact on the region


13%

38%

45%

51%

Geostrategic tensions in theSouth China Sea

E-Commerce

Deepening income inequality

Rise of the US dollar

Cheap oil

16%

29%

39%

54%

Deepening income inequality

Geostrategic tensions in theSouth China Sea

E-Commerce

Cheap oil

Rise of the US dollar


Which of the following regional trends do you think will have the biggest impact on your country in 2015? (please check all that apply)

35% 17%

22

ASEAN Outlook 2015

Which of the following digital trends do you think will become more prevalent in your country and company in 2015?

23

CEO’s Perspective

12%

31%

41%

48%

49%

Wearable internet devices

Bring your own device (BYOD)

The internet of things

Big data analytics

Digital payments

Big data analytics, digital payments and the internet of things are big for this year

Answered: 87

4. Which of the following digital trends do you think will become more prevalent in your country in 2015?

10%

35%

39%

40%

49%

Wearable internet devices

Digital payments

Bring your own device (BYOD)

The internet of things

Big data analytics

5. Which of the following digital trends do you think will become more prevalent in your company in 2015?

Answered: 90

24

2015 trends

24

The trends The catalysts The beneficiaries The institutions

May your 2015 be profitable

business outlook survey of 860 executives in asean and their perspectives on aec

Economy & Finance