ASEAN forecast upbeat for 2014
ASEAN forecast upbeat for 2014
Business optimism in the ASEAN economies heading into 2014 is rising, and is currently up 45 per cent, according to new research from Grant Thornton's International Business Report (IBR).
This is thanks to improvements in confidence in Viet Nam (from – 10 per cent up to 40 per cent), the Philippines (72 per cent up to 90 per cent), Malaysia (12 per cent up to 20 per cent) and Indonesia (56 per cent in third quarter to 78 per cent in fourth quarter 2013).
The figure is in stark contrast to the optimism among ASEAN countries this time last year, which stood at net 25 per cent. Meanwhile, global business optimism has dropped back to 27 per cent.
Optimism in Southeast Asia crept up for the third quarter straight, boosted by Indonesia (78 per cent), although Thai businesses (-20 per cent) remain unsettled by ongoing political unrest.
"Things seem to be improving quite markedly in ASEAN economies. The contrast from 12 months ago is stark – as business leaders plan for 2014, optimism in the ASEAN look more robust, however uncertainty is growing in some countries," Ken Atkinson, Managing Partner at Grant Thornton, said.
It should however be noted that revenue prospects across the ASEAN have fallen by 59 percentage points over the past 12 months, to 54 per cent.
In Viet Nam, expectations for revenue growth have decreased from 90 percentage points to 52 per cent over the same period.
Similarly, peers' expectations for rising profits have dropped in Viet Nam (86 to 50 per cent) Thailand (53 down to 16 per cent), Singapore (46 down to 28 per cent), Malaysia (56 down to 52 per cent) and the Philippines (66 down to 60 per cent) compared with 12 months previously (fourth quarter 2012).
By contrast, Indonesia has the most optimism for increasing profitability (70 per cent).
Expectations for employment, investment and salaries have recovered (37 per cent) in the ASEAN after a slowdown in the first three quarters of 2013.
However Thai business leaders are more pessimistic than their peers in Philippines (26 per cent), Viet Nam (32 per cent) and Malaysia (36 per cent). This is due to the fact that Thailand has been gripped by riots which has hindered business growth.
"The hope is that we are moving toward a more balanced regional economy with fewer extremes. This should support business growth prospects; greater balance and less volatility means businesses can plan for the future and make decisions with greater certainty," added Ken Atkinson.
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