Most Asia Pacific firms expanding in near term
Two-thirds of existing companies in the 21 economies belonging to the Asia-Pacific Economic Cooperation (Apec) will expand their operations in the near term, with the Philippines seen as one of the top 10 countries to benefit from the expansion activities.
According to the report titled “New vision for Asia-Pacific: Connectivity creating new platforms for growth” released by global professional services network and auditor PricewaterhouseCoopers (PwC), 67 percent of firms operating in the region said they would increase their investments over the next 12 months.
PwC’s report, released on the occasion of the ongoing 2014 Apec Summit in China, showed that 72 percent of business executives polled had said they would likely expand in China in the near term.
The other top expansion sites are the United States (61 percent of respondents), Indonesia (57 percent), Hong Kong (51 percent), Singapore (50 percent), the Philippines (47 percent), Vietnam (45 percent), and Japan, Malaysia and Thailand (43 percent each).
In the case of the Philippines, however, 7 percent of those surveyed said they would likely decrease their investments in the country over the next 12 months.
For the medium-term, 57 percent of businesses in Apec member-economies said they were planning to expand their capital projects and facilities in the next three to five years.
On the top of Apec countries being eyed for mid-term expansion is China, which was chosen by 37 percent of respondents.
The other top choices as expansion areas in three to five years are Australia (19 percent ), United States (19 percent), Indonesia (18 percent), Hong Kong (17 percent), Vietnam (15 percent), Singapore (14 percent), New Zealand (13 percent), the Philippines (13 percent), and Taiwan (12 percent).
According to PwC, executives deemed that there had been “incremental” improvements in terms of technology and trade infrastructure across Apec since 2012.
However, a challenge to investor confidence in the region is basic infrastructure, according to the report. “Improvements in basic infrastructure are not seen as coming fast enough,” it said.
In Southeast Asia, for instance, infrastructure bottlenecks are seen impacting significantly on operations and growth prospects of companies there, it said.
For the entire Apec, investors were more optimistic, especially in terms of revenues.
In 2014, 46 percent of business executives are “very confident” to post revenue growth over the next 12 months, up from 36 percent in 2012, the survey showed.
The number of firms that are “not confident,” is on the decline.
The Philippines and Vietnam, in particular, were cited in the PwC report as two developing Apec economies that were expected to achieve “steady pace of growth.”
