U. S. Business in Thailand More Optimistic About Increased Profits
U. S. companies remain generally optimistic about business prospects in the Association of Southeast Asian Nations ( ASEAN), even in the face of global economic headwinds and challenges, according to the annual ASEAN Business Outlook Survey released by the U. S. Chamber of Commerce and the American Chambers of Commerce in ASEAN member countries. In a poll of senior executives representing U. S. companies in all 10 ASEAN countries, 78% expect their profits to increase in 2017, with more than half ( 53%) reporting that ASEAN markets have become more important for their companies’ global bottom line. Close to half of the surveyed companies ( 49%) expect to increase their ASEAN workforce by the end of 2016. The overwhelming majority of respondents ( 87%) expect that their companies’ level of trade and investment in ASEAN will increase over the next 5 years.
In Thailand, seven in ten executives expect profits in the region to increase in 2017, up from five in ten executives who were optimistic about increased profits in last year’s survey. In a worrying trend however, 35% of respondents described the overall investment environment in the country as deteriorating. By contrast, a significant majority of those surveyed in Cambodia ( 65%), Myanmar ( 70%), Philippines ( 77%), and Vietnam ( 72%) characterize the investment environment in their respective countries as improving. Respondents in Thailand identify corruption, local protectionism, lack of stable government and political system, and the difficulty of moving goods through Customs as the biggest impediments to doing business in Thailand.
“The Royal Thai Government understands that due to regional development trends and global free trade agreements the region is becoming increasingly competitive, and has consequently made efforts to improve the business environment and attract foreign direct investment. The Government’s measures and strategies range from providing incentives for regional headquarters and start- ups to developing the country’s digital economy.” said Brad Middleton, AMCHAM Thailand’s President. “We applaud these measures and urge the Government to do more to stimulate the economy and encourage investment, such as relax visa rules, improve protection of intellectual property rights, and synchronize customs rules with international best practices.”
In Myanmar, 91% of executives surveyed reported that they expect profits in the region to increase in 2017 and 96% anticipate expanding their operations. Moreover, 70% of respondents say the overall investment environment in the country is improving. Consequently, Myanmar continues to be a top three priority market for future business expansion along with Vietnam and Indonesia. In continuing good news for the Myanmar economy, 87% of respondents anticipate to expand their workforce in the coming year. Despite the overwhelming optimism, executives point out a number of factors that impede the further growth of the Myanmar economy. A significant majority of respondents identify the availability of trained personnel ( 83%), office least costs ( 83%), infrastructure ( 78%), laws and regulations ( 78%), housing costs ( 78%), tax structure ( 70%) and corruption ( 70%) as serious concerns for U. S. companies in Myanmar.
American executives in Thailand are of the opinion that increased political stability and regional and global integration will have a positive impact on the ease of doing business in Thailand. 82% of those surveyed reported that the ongoing political stalemate is affecting their business, while 83% believe that Thailand should join the Trans- Pacific Partnership ( TPP).
This year’s ASEAN Business Outlook survey includes a new section that discusses talent sourcing and workforce development in ASEAN.
The survey finds that the attributes most valued by U. S. businesses in ASEAN are creativity, analytical problemsolving, technical skills, and effective communication. The most desirable qualities for employers in Thailand are management and leadership, foreign language proficiency, and sales and marketing skills. The full report can be accessed on AMCHAM’S website.