Trade frictions fail to dent CEO confidence in Asia-Pacific
Confidence in revenue growth is pushing companies across the 21 Asia-Pacific Economic Co-operation’s (Apec) economies, with a net 50 percent of businesses planning to increase global investments, up from 43 percent last year, as ‘Apec businesses increase their foothold and influence on the global economy,’ according to new PwC research.
Seventy-one percent of the 1,400 business leaders surveyed who say they are raising investment ‘will direct those increases into Apec economies in 2018,’ notes PwC in a press statement, while 63 percent of all Apec CEOs ‘expect their broader global footprint to expand over the next three years’. This increases to 89 percent for Malaysian CEOs and 86 percent for those from Vietnamese firms.
Top of the list to benefit from domestic investments are Vietnam, Russia, the Philippines, Indonesia and Malaysia. When it comes to overseas investment, Vietnam, China, Indonesia, the US and Thailand are the top targets.
This confidence comes even as the region’s business leaders say they have been experiencing a more restrictive trade environment, particularly focused around employing foreign labor or in moving goods across borders, with many expecting these issues to continue or increase over the coming 12 months.
‘Business leaders’ confidence suggests they are not waiting for the fog of uncertainty to clear to push ahead with investment plans,’ says Bob Moritz, PwC global chairman, in the press release. ‘In the short term this will drive momentum for Apec, increasing its global influence and supporting deal activity, with 71 percent of CEOs expecting to rely more on business partnerships/joint ventures in the future.
‘The majority of business leaders are bullish for growth and see Apec becoming more economically linked over time, with three quarters seeing slow current progress toward deepening economic integration.’
In fact, the region’s business leaders are increasingly seeing local companies as their biggest competition: ‘19 percent believe their biggest competitor in the next three to five years will be a multinational from an emerging economy, or regional leaders in Apec economies (22 percent),’ notes PwC. At the same time, the perceived competition from developed nation multinationals as the top rival is down from 41 percent in 2014 to less than a third (23 percent) today.