Thursday, August 17, 2017 - 17:03:21

ASEAN business forecast upbeat for 2014

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Business optimism in the ASEAN economies heading into 2014 is rising, and is currently up 45 percent, according to new research from Grant Thornton's International Business Report (IBR).

This is thanks to improvements in confidence in Vietnam (from 10 percent up to 40 percent), the Philippines (72 percent up to 90 percent), Malaysia (12 percent up to 20 percent), and Indonesia (56 percent to 78 percent) in third quarter to the fourth in 2013.

The figure is in stark contrast to the optimism among ASEAN countries this time last year, which stood at net 25 percent. Meanwhile, global business optimism has dropped back to 27 percent.

Optimism in Southeast Asia crept up for the third quarter straight, boosted by Indonesia (78 percent), although Thai businesses (-20 percent) remain unsettled.

"Things seem to be improving quite markedly in ASEAN economies. The contrast from 12 months ago is stark – as business leaders plan for 2014, optimism in the ASEAN look more robust, however uncertainty is growing in some countries," Ken Atkinson, Managing Partner at Grant Thornton, said.

It should however be noted that revenue prospects across the ASEAN have fallen by 59 percentage points over the past 12 months, to 54 percent.

In Vietnam, expectations for revenue growth have decreased from 90 percentage points to 52 percent over the same period.

Similarly, peers' expectations for rising profits have dropped in Vietnam (86 to 50 percent) Thailand (53 down to 16 percent), Singapore (46 down to 28 percent), Malaysia (56 down to 52 percent) and the Philippines (66 down to 60 percent) compared with 12 months previously (fourth quarter of 2012).

By contrast, Indonesia has the most optimism for increasing profitability (70 percent).

Expectations for employment, investment and salaries have recovered (37 percent) in the ASEAN after a slowdown in the first three quarters of 2013.

However Thai business leaders are more pessimistic than their peers in the Philippines (26 percent), Vietnam (32 percent) and Malaysia (36 percent). This is due to the fact that Thailand has been gripped by riots which has hindered business growth.

"The hope is that we are moving toward a more balanced regional economy with fewer extremes. This should support business growth prospects; greater balance and less volatility means businesses can plan for the future and make decisions with greater certainty," added Ken Atkinson.

The Association of Southeast Asian Nations, known as ASEAN, comprises of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.-VNA
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