Saturday, June 18, 2005

PM: 'NEW ASIA' WILL BE EASIER TO RELATE TO, NAVIGATE

Koh Lay Chin from Hong Kong

A "NEW Asia" where countries strive to be more efficient, innovative and less fraught with red tape and graft awaits international business leaders. Investors will also find a region which will be better equipped, easier to navigate and with a larger pool of home-grown talent, Prime Minister Datuk Seri Abdullah Ahmad Badawi said.

He said governments in the region were making efforts to overcome challenges such as complex regulations and perceived risks of geopolitical instability and terrorism.

He acknowledged that there were those who lamented the shortage of skilled and innovative leaders and managers in Asia, in addition to infrastructure problems and transaction costs due to bureaucracy.

"We must recognise that there have been great determination and tremendous effort made by governments and peoples in Asia to overcome these challenges.

"This determination and effort has resulted in a strong feeling of regeneration, renewal and progress in Asia today, hence an excitement over the ‘New Asia’," he said when addressing international business leaders at the 38th Pacific Basin Economic Council yesterday.

Abdullah said the world’s focus and centre of gravity was shifting to Asia, led by the two potential economic juggernauts of China and India.

It is estimated that Asia, with more than half the world’s population, will generate two-thirds of the world’s gross domestic product (GDP) by 2010.

A prime example of progress in the "New Asia", he said, was the move towards closer economic integration, starting with Asean, Asean+3 and beyond.

"An Asean of half a billion people spread over 10 fragmented markets is not quite the value proposition of an Asean of 10 integrated markets," he said.

Abdullah said Asean members were pursuing a multi-dimensional and multi-layered approach to co-operation in the creation of the Asean Economic Community and the Asean Socio-Cultural Community.

Another example of the "New Asia" was the commitment of Asian Governments and local businesses towards becoming more efficient and effective.

"Companies exposed to global competition have learnt to be nimble and flexible, while governments with highly open economies have learnt the necessity of cutting red tape and reducing bureaucracy," he said.

Globalisation now meant countries not only had to appease investors he said, but also analysts and surveyors who constructed "inscrutable indices" and ranked their performance against many other countries.

"In this case, the openness to perceptions of investors, as well as to investment and trade flows, have made Asian stakeholders much more responsive to the needs of business."

Abdullah said the "New Asia" was also characterised by an increasing drive for innovation, with countries such as Japan, Taiwan and South Korea accounting for more than a quarter of all United States patents awarded each year.

Taiwan and Singapore had leapfrogged the US in the overall number of patent citations, he said, while China would see the next wave in innovation.

As such, business leaders would find Asia very attractive for investment in this area, as Asia would continue to improve availability and quality of its education systems.

"What then are the implications of this ‘New Asia’ for business leaders? The good news, in my opinion, is that business leaders will find Asia easier to relate to and easier to navigate," he said.

"Asia will be better equipped in terms of infrastructure, better connected within the region and outfitted with more and more home-grown talent."

Abdullah said competition in the "New Asia" would be fierce, and home-grown companies would be a force to be reckoned with, not only within Asia but also externally.

Multinationals in the region should take note of important lessons from Asian companies, he said, as no matter how interconnected and interdependent Asia was, the different markets in the region would still have their own identities and preferences.

"This presents a great challenge to those wanting to ‘conquer’ Asia, but it is an interesting challenge that makes business in Asia so fascinating.

"There are of course some similarities, to be sure, but the savvy business leader would do well to tease out the differences and use them to their advantage."

Abdullah also pointed out that although Asian countries had a long history of partnering and working together, their people were selective and discriminating.

"We look to sincere and honest relationships, and we look to partners who are here for the long haul, not those who are in and out to make a quick killing.

"For most, there is a sense of humility and a desire to contribute generously to the area in which you operate. Win-win solutions are invariably sought. In modern parlance, we may call this ‘smart partnership’."

He said to keep the momentum going, Asian businesses and governments had to pool resources and share knowledge in order to prosper together.

NST 14/6/2005

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