60% of Greater Bay Area companies mulling further expansion into Asean: poll

AROUND 60 per cent of companies in the Guangdong-Hong Kong-Macau Greater Bay Area (GBA) are considering further expansion into Asean countries within the next 3 years, according to a Nov 29 report by UOB Hong Kong and the Hong Kong Trade Development Council (HKTDC).

The report, based on a survey of 657 GBA-based countries across various sectors from July to September 2021, found that Asean countries are attractive business destinations, particularly because of their cost effectiveness, abundant resources and huge markets.

Among the 10 Asean countries, Singapore, Malaysia, Vietnam, Thailand and the Philippines are the most popular trade and investment destinations. Most GBA companies chose Singapore (55.4 per cent), Malaysia (53 per cent) and Vietnam (51.1 per cent) as markets for sales, while they preferred Vietnam (14.5 per cent), Thailand (10.4 per cent) and Indonesia (8.1 per cent) as production or sourcing bases for the next 3 years.

Additionally, 10.4 per cent of the GBA companies selected Singapore as the preferred location to set up regional offices.

Out of the companies surveyed, those in the industrial goods sector have the greatest interest in expanding into the Asean region, followed by those in real estate; hospitality and construction; and business, professional and financial services sectors.

Christine Ip, UOB's chief executive officer for Greater China, said: "Cross-border trade and investment flows between Asean countries and the GBA are driven by the 2 regions' increasing interconnectivity and collaboration in areas such as sustainable development."

A NEWSLETTER FOR YOU

Friday, 8.30 am

Asean Business

Business insights centering on South-east Asia's fast-growing economies.

Sign Up

Nicholas Kwan, HKTDC's director of research, also emphasised the need to foster greater interconnectivity between the 2 regions.

According to the report, Hong Kong plays a key role in GBA's collaboration with the Asean market because of its status as a "one-stop business centre" with a simplified tax system and a diverse range of investment products and services.

"GBA companies highly appreciate Hong Kong's advantages in business environment, financial infrastructure and cross-border resource flow," said Kwan.

READ MORE:

• Singapore to strengthen collaboration with China's Greater Bay Area: Ong Ye Kung

• Remaining open an imperative for Asean's growth post-Covid

• Most Asean economies to see accelerated GDP growth, above-average earnings gains: Goldman