ASEAN as a vital trading partner to the U.S.
The rapid growth of ASEAN has made it an attractive destination for investment, with the U.S. being a key trading and investment partner.
In fact, ASEAN is today the United States’ fourth-largest trading partner and the largest single foreign direct investor in the ASEAN region. The region benefits from over US$306 billion in investment. ASEAN is extremely important to the U.S., with nearly 4,700 companies in the region and over 500,000 American jobs supported by business with ASEAN.
“ASEAN is the most competitive region for U.S. businesses, with high adaptability, innovativeness, and a large pool of skilled and unskilled resources,” according to the 2018 ASEAN Business Outlook Survey, an extensive study that is published annually by the American Chamber of Commerce Singapore.
Today, on the 50th anniversary of ASEAN, many U.S. companies are optimistic about growth prospects and commercial opportunities in the region. In the survey, which was done in collaboration with other AmChams in the region, 58% of respondents expect that ASEAN markets will become more important to their companies’ worldwide revenue over the next two years. In addition, 80% expect their companies’ level of trade and investment in ASEAN to increase over the next five years.
For multinational companies like Coca-Cola, ASEAN’s potential is clear. The company just completed 105 years of operations in the Philippines and 91 years in Singapore and Malaysia. With a presence in all 10 ASEAN nations, Coca-Cola has multiple manufacturing plants in Indonesia and Philippines.
Additionally, the company recently unveiled a new $79 million storage and distribution centre in Singapore, which will support the company’s business in the region. Coca-Cola is investing heavily in automation and technology within this facility as it looks to develop more beverage options for consumers here.
“We have seen steady growth momentum over the past 10 years and we forecast that between now and 2022 the ready-to-drink market will almost double,” said Iain McLaughlin, President, ASEAN Business Unit, The Coca-Cola Company in the survey.
“For us, ASEAN is viewed as one of the key growth drivers for the business overall, and we, together with our bottling partners, are investing to be in a position to capture that growth,” he adds. “In addition to China or India, ASEAN has considerable growth potential in the short-term.”
The Citigroup has also benefitted from its presence in the region. “In 1971, Citi had 150 employees in Singapore. Today, we provide employment to 9,000 individuals, making Citi the largest foreign banking employer in Singapore,” said Amol Gupte, Head of ASEAN and Citi Country Officer for Singapore, Citi. 40% of Citi’s Asia-Pacific staff is located in ASEAN and the group has global processing hubs and data centres in Singapore, Malaysia, and the Philippines.
Shaping this growth further is the ASEAN Economic Community (AEC) that was established in 2015, which aims to create a highly competitive economic area with a single market and production base, strengthened export capacity and better-integrated regional supply chains. As part of the implementation of the AEC Blueprint 2015, measures have already been taken to reduce and eliminate barriers to trade in goods, services and investment. As the AEC matures, it is anticipated to further improve the environment for doing business in the region.