US businesses are increasingly optimistic about their prospects in Southeast Asian markets, according to a survey by the American Chamber of Commerce in Singapore (AmCham). Nearly 90 percent expect their trade with ASEAN to grow over the next five years, and trade will receive a boost from regional integration plans slated for next year.
"These positive findings point to positive outcomes for ASEAN ? more jobs, more exports, more commerce and more rapid economic growth," says Judith Fergin, AmCham Singapore executive director.
The 2015 ASEAN Business Outlook Survey was conducted online and garnered responses from 588 AmCham members in all 10 markets. ASEAN, the Association of Southeast Asian Nations, comprises 10 mostly emerging countries that have a rapidly growing middle class and high economic growth potential.
Optimistic about ASEAN
Two in three respondents said ASEAN will be more important for their company over the next two years. With such strong growth potential, and with more than 60 percent of respondents believing there is positive sentiment towards the US, ASEAN represents a strong potential market for American businesses.
"This survey illuminates where opportunities are great and suggests areas where increased resources and fresh approaches will further strengthen the business climate for foreign and domestic investors alike," says AmCham Singapore chairman James Andrade.
Strong interest in Myanmar
One of the hottest ASEAN markets in recent years has been Myanmar, and businesses there expect growth to continue. While 44 percent say restrictions such as US sanctions against Myanmar and prohibitions on contracts with the armed forces affect their investment decisions, 77 percent expect their workforce there to expand in 2014 while over 91 percent expect profits to increase next year.
Slower ASEAN integration
The impact of ASEAN integration is growing, especially with the ASEAN Economic Community scheduled to come into effect in 2015. 81 percent believe ASEAN integration is important for their company doing business in the region, with results ranging from 69 percent in the Philippines to 92 percent in Laos
However, businesses expect integration to take longer than forecast, with only 4 percent expecting ASEAN to realise its goals for integration by 2015 and 52 percent thinking it will take until 2020 or longer. In spite of the fact that most respondents think that ASEAN will only realise the goals of the AEC in 2020 or later, 53 percent already have a specific ASEAN strategy.
"This survey substantiates what ASEAN-based executives of US companies witness every day ? that ASEAN is a dynamic and forward-looking region with enormous growth potential, energetic populations, and exciting prospects for regional integration," says Andrade.
Edited by Claire Slattery and Clement Quek. This article was first published on Singapore Business News.