If it’s not ASEAN, what is it going to be?

Reading Time: 2 minutes

It’s time for the GCC (Gulf Cooperation Council) to look East. Watching the economic tragedy in the EU (European Union) and the US won’t get the Gulf region far, albeit a few bargains might turn up for impulsive investors. But the pattern of growth in the Old World has been interrupted.

By Arno Maierbrugger

Global capital is now shifting around the globe, and, as always, is following the most promising path. And actually it is now ending up in Southeast Asia, or, to be more precise, in the Association of Southeast Asian Nations (ASEAN) nations, which have increasingly been identified by the global business community as new investment havens with growth prospects unheard of at present times.

Many Qataris might recall Southeast Asia as a holiday destination, a place to cure their illnesses, or a stopover destination on the way to China, South Korea or Japan to do business there.

But things have changed rapidly. ASEAN has decided to grow together to a single market of 600mn consumers by 2015, linked by a Free Trade Area to create a free flow of goods and services. Key ASEAN countries such as Thailand, Indonesia, Malaysia, the Philippines and Vietnam all enjoyed GDP growth between 4 per cent and 6 per cent or more over the past two years, as opposed to the Old World. The economic area of ASEAN has a reached a combined GDP of $2.2tn in 2011, surpassing India’s, and could reach $10tn by 2030, says the International Monetary Fund. So, if ASEAN is not the next economic powerhouse of the world, where is it going to be?

Key Qatar companies have already seized the opportunities. For example, Qatar Airways, which opened new flight destinations to Myanmar recently, added additional frequency to Malaysia and Indonesia and will fly directly to Cambodia from early next year. Qatar Petroleum and Qatargas have signed a few big-ticket deals with Thailand, Indonesia, Vietnam and Brunei. And a number of other deals in the financial services, hospitality, mining and farming sectors have been initiated lately.

However, ASEAN offers more for Qatar. Given the pressing issue of food security in the Gulf region, the “kitchen of the world,” as Southeast Asia is dubbed, can be of greatest interest for strategic partnerships between Qatar and major food-producing countries in ASEAN, including halal manufacturers. Also, in the infrastructure sector in ASEAN, know-how and investment from experienced Qatari firms would be desperately needed. Energy and industry are other sectors where Qatari firms could make big steps in ASEAN.

This comment is Inside investor’s weekly contribution to Qatar’s leading newspaper Gulf Times and is published every Sunday.

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Reading Time: 2 minutes

It’s time for the GCC (Gulf Cooperation Council) to look East. Watching the economic tragedy in the EU (European Union) and the US won’t get the Gulf region far, albeit a few bargains might turn up for impulsive investors. But the pattern of growth in the Old World has been interrupted.

Reading Time: 2 minutes

It’s time for the GCC (Gulf Cooperation Council) to look East. Watching the economic tragedy in the EU (European Union) and the US won’t get the Gulf region far, albeit a few bargains might turn up for impulsive investors. But the pattern of growth in the Old World has been interrupted.

By Arno Maierbrugger

Global capital is now shifting around the globe, and, as always, is following the most promising path. And actually it is now ending up in Southeast Asia, or, to be more precise, in the Association of Southeast Asian Nations (ASEAN) nations, which have increasingly been identified by the global business community as new investment havens with growth prospects unheard of at present times.

Many Qataris might recall Southeast Asia as a holiday destination, a place to cure their illnesses, or a stopover destination on the way to China, South Korea or Japan to do business there.

But things have changed rapidly. ASEAN has decided to grow together to a single market of 600mn consumers by 2015, linked by a Free Trade Area to create a free flow of goods and services. Key ASEAN countries such as Thailand, Indonesia, Malaysia, the Philippines and Vietnam all enjoyed GDP growth between 4 per cent and 6 per cent or more over the past two years, as opposed to the Old World. The economic area of ASEAN has a reached a combined GDP of $2.2tn in 2011, surpassing India’s, and could reach $10tn by 2030, says the International Monetary Fund. So, if ASEAN is not the next economic powerhouse of the world, where is it going to be?

Key Qatar companies have already seized the opportunities. For example, Qatar Airways, which opened new flight destinations to Myanmar recently, added additional frequency to Malaysia and Indonesia and will fly directly to Cambodia from early next year. Qatar Petroleum and Qatargas have signed a few big-ticket deals with Thailand, Indonesia, Vietnam and Brunei. And a number of other deals in the financial services, hospitality, mining and farming sectors have been initiated lately.

However, ASEAN offers more for Qatar. Given the pressing issue of food security in the Gulf region, the “kitchen of the world,” as Southeast Asia is dubbed, can be of greatest interest for strategic partnerships between Qatar and major food-producing countries in ASEAN, including halal manufacturers. Also, in the infrastructure sector in ASEAN, know-how and investment from experienced Qatari firms would be desperately needed. Energy and industry are other sectors where Qatari firms could make big steps in ASEAN.

This comment is Inside investor’s weekly contribution to Qatar’s leading newspaper Gulf Times and is published every Sunday.

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