AmCham poll shows cautious American outlook re Asia

American investors are largely optimistic about the growth prospects and commercial opportunities in the ASEAN region, but “the percentages of respondents indicating that they expect ASEAN to grow in importance in terms of their companies’ worldwide revenue in the coming years have slightly declined in each of the past four years”, the latest American Chambers of Commerce report on the region has shown.

In the most recent AmCham survey, which polled members of the American Chamber of Commerce whose companies conduct business in the 10 member states of the Association of Southeast Asian Nations, 61% of respondents said they foresaw the ASEAN region as being more important for their businesses in the next few years, compared with 73% in 2013.

But “more than half of respondents (53%) report that ASEAN markets have become more important in terms of their companies’ worldwide revenue over the past two years, and 78% of executives project profit increases in 2017.

“Close to half of the surveyed companies (49%) expect to increase their ASEAN workforce by the end of 2016. The overwhelming majority of respondents (87%) expect that their companies’ level of trade and investment in ASEAN will increase over the next five years.”

Asked about a relatively new regional initiative, the so-called ASEAN Economic Community, which was kicked off at the end of 2015, the respondents said they “anticipate that it will provide greater flexibility and efficiency in managing their regional operations”, the survey’s authors note, in their executive summary.

And though the Trans-Pacific Partnership trade deal seemed at the time the report was being prepared to be unlikely to be approved by the US Congress, the survey’s respondents said they anticipated it would, if enacted, “provide greater flexibility and efficiency in managing their regional operations”.

In total, the survey polled 3,154 ASEAN country-based executives between 25 April and 24 May of this year, and received online feedback from another 519.

The survey, now in its fifteenth year, was compiled and published by the American Chamber of Commerce in Singapore and the US Chamber of Commerce.

‘Investment environment’

While the AmCham survey found overall optimism towards the business outlook in the ASEAN region going forward, it also picked up some “significant variation by country” with respect to whether the “investment environment” was improving.

In this area, the Philippines, Vietnam, Myanmar and Cambodia scored the highest in terms of the percentage of respondents who described them as having an “improving” business environment, with responses ranging from 77% to 69%, respectively.

Brunei drew the largest number of respondents who regarded its investment environment as “deteriorating”, with 42% saying this was how they’d describe it and just 16% saying it was improving; Thailand was next, with 35% saying its investment environment was on the decline, 43% saying it seemed unchanged, and 35% saying it was “deteriorating”. (Thailand has been ruled by a military junta since a coup in 2014, with an election set for next year, following on from a constitutional referendum earlier this month.)

The AmCham survey respondents also gave Indonesia, Laos and Malaysia a relatively high vote for having a “deteriorating overall investment environment”  – 25% in all three cases  – though 58% said the environment in Laos was actually improving, compared with just 23% who said the same about Malaysia.

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