ASEAN companies look to strike it rich in the neighborhood www.asia.nikkei.com
VIENTIANE -- Companies in ASEAN countries are on an investment spree in the region. Sensing opportunities in Southeast Asia's expanding consumer markets and ongoing infrastructure development, they are rushing to build factories and make acquisitions.
Companies from the Association of Southeast Asian Nations overtook their European counterparts in 2015 to become the biggest investors in the region by value for the first time in three years. That investment should help sustain economic growth regionwide.
The five-story Myanmar Plaza, which opened last December in Yangon, is a showcase for famous domestic and foreign brands, including German sportswear maker Adidas. Myanmar's first modern shopping mall is thronged with buyers from the country's swelling middle class.
The mall was built by Vietnamese real estate developer Hoang Anh Gia Lai. Next door, an office building has already been completed. An upscale condominium building is scheduled to go up by 2018. In all, $440 million will be invested in the complex.
Buying time
U.K. research company Euromonitor estimates ASEAN's retail market will expand by about 20% between 2015 and 2020 to $588.3 billion. Companies are piling in, trying to get a piece of the action.
Boon Rawd Brewery, a Thai maker of alcoholic beverages best known for its Singha beer, is pushing into Vietnam, investing a total of $1.1 billion in a food company and a beverage producer that are part of local conglomerate Masan Group. Vietnam Dairy Products, the biggest dairy maker in the country, in May began production in neighboring Cambodia.
According to a report issued Sept. 6 by the United Nations Conference on Trade and Development, investment in the ASEAN region totaled $119.9 billion in 2015, down 8% from the previous year but still the third-largest year on record. ASEAN companies accounted for nearly 20% of the total, taking the top investor spot from European companies, which had held the position for two years through 2014.
ASEAN companies are likely to continue their cross-border expansion, becoming serious competitors to Japanese companies operating in the region.
Published Date:2016-09-08