The FINANCIAL — U.S. companies remain optimistic about business prospects in the Association of Southeast Asian Nations (ASEAN), according to new survey results released by The American Chamber of Commerce in Singapore (AmCham Singapore) and the U.S. Chamber of Commerce.
In a poll of 475 senior executives from U.S. companies operating across the region, 79% reported that their company’s level of trade and investment in ASEAN increased over the past two years, and an overwhelming 91% of respondents expect it to increase over the next five years, according to U.S. Chamber of Commerce.
Simultaneously, the ASEAN Business Outlook Survey found substantial concerns and impediments to companies’ growth in the region. Corruption was the top issue across ASEAN, with the majority of respondents in all countries except Brunei and Singapore expressing dissatisfaction. Business leaders also cited burdensome laws and regulations as obstacles to greater investment, as well as the poor quality of infrastructure, and the difficulty in moving products through customs in some countries.
The survey also revealed that regional economic integration efforts, such as ASEAN’s agreements on trade in goods and services, are important to U.S. companies’ investment plans in the region. 54% of respondents said that their company has a strategy based on the goals of the ASEAN Economic Community, which aims to integrate the region by 2015. Moreover, nearly half of the U.S. manufacturing companies surveyed report that they utilize the provisions of ASEAN’s free trade agreements with major trading partners to export from ASEAN, according to U.S. Chamber of Commerce.
Of the two major regional free trade agreements currently being negotiated, the Transpacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP), more respondents expect the TPP to have a greater impact on their companies’ future investments in the region than RCEP, but many respondents are not sure about the impact of either agreement.
“ASEAN has the opportunity to position itself at the center of a very exciting evolving regional trade architecture,” said Tami Overby, the U.S. Chamber’s vice president for Asia the U.S. Chamber of Commerce. “This survey shows that U.S. companies are thinking regionally, and as ASEAN continues to integrate, U.S. companies will need to increasingly focus on strategies to realize ASEAN’s potential,” she added.
“Singapore remains one of the most attractive countries in ASEAN to do business, with low levels of corruption, excellent infrastructure, and predictable laws and regulations,” said Simon Kahn, Chairman of AmCham Singapore. “Another highlight in the region is the marked improvement of the Philippines. The country has experienced high levels of growth recently and our survey shows why, as business leaders there indicate higher levels of satisfaction across almost all surveyed factors as compared to five years ago,” he added.
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