The Association of Southeast Asian Nations (ASEAN) is home to 8 of 18 developing economies that averaged at least 3.5% annual per capita GDP growth over 50 years or 5% annual growth over 20 years.
According to a report published by McKinsey Global Institute, who took a deeper look at 71 major developing economies around the world, there have been only 18 countries in the world that have accounted for the lion’s share of economic growth and rising consumption over the past half century. The 8 countries are:
The report noted that the Philippines “did not clear either threshold but its recent rapid growth could lift it to the ranks of outperformers in the future”.
The report concluded that there were two factors that contributed to the dynamic growth we have seen in South East Asia over the last 50 years:
- Pro-growth policy agendas
- The presence of dynamic companies.
Pro- growth policies boost capital accumulation, increase savings and thereby allows the growth of financial firms. This growth attracts investments from foreign companies and these international large revenue enterprises encourage productivity and support the development of small and medium size enterprises via purchasing or subcontracting. Together both these factors create a cycle of increased income for the local workforce and demand for a product.
While economies like the Philippines and Vietnam continue to prosper, the slowdown of economies globally will probably will take its toll in Southeast Asia. Especially due to China’s tight relationship with the region, demand that’s taken quite a hit in the world’s No. 2 economy amid tariffs and structural changes will negatively affect the neighborhood.
Economists are seeing a quiet rise in inflation for much of Southeast Asia in 2019. Just the Philippines will be spared, according to Bloomberg surveys.
Kelmer Group have seen much potential in these markets this is why we have chosen to open up offices in Singapore, Manila and Hanoi in the last 2 years. With new policies like EU Vietnam Free Trade Agreement, we have also noticed clients being more interested in exploring these markets.
For more information about investing in the South East Asia, feel free to get in touch with our representatives.
Kelmer Singapore PTE. LTD
Mr. Francesco Franzin
Business Development Manager
Kelmer Philippines INC.
Mr. Glyndel Rodrigo
Tax & Legal Consultant
Kelmer Vietnam Co. Ltd
Ms. Nguyen Minh Thu
Business Development Executive