Plenty of motivation for India to open up and engage

With the possible exceptions of China and Thailand, most Asian economies should see further economic growth in 2018.

India and the Asean nations are expected to pick up some of the slack left by China, and this may continue for some years to come.

India is also set to overtake the UK and France next year to become the world’s fifth-largest economy in dollars, according to a report by The Centre for Economics and Business Research. It is also forecast to overtake Germany in 2027.

It remains to be seen if India can maintain this growth trend, as it actually experienced a decline in growth as recently as 2016-2017.

Nonetheless, the possibility of climbing up the World Bank’s Ease of Doing Business Index provides a lot of motivation for India and the Asean nations to continue to open up and engage.

Turning to Asean, the Philippines and Vietnam will continue to grow healthily by more than 6 per cent over the next few years. Indonesia is not far behind, and the smaller economies of Myanmar, Cambodia and Laos are growing at more than 7 per cent. In this way, the region will continue to be attractive for businesses.

A key priority for Asean in 2018 is to make sure that the region works more holistically, both economically (around the framework of the Asean Economic Community) and politically (for example on issues such as South China Sea disputes with China).

This hints at a move to treat Asean as a single market, with entry through a hub nation affording access to the other markets in the region.

Indeed, accessing India through Asean is a possibility under the umbrella of the Asean-India Free Trade Area and the renewed discussion about more collaboration between these nations.

In relation to this, the Regional Comprehensive Economic Partnership (RCEP) negotiations are likely to continue. Negotiations around this multilateral arrangement have been going on since 2013. If all goes well with the Asean-India negotiations, we might see the RCEP on the table more often in

A key priority for Asean in 2018 is to make sure that the region works more holistically.

the coming year or two.

We should also see more financial integration in Asia.

Part of this is driven by the trend towards using electronic payments for transactions.

In a survey by PayPal of consumers and merchants, 75 per cent of respondents in China chose electronic methods as their most frequently used form of payments. This is followed by Singapore (57 per cent) and Hong Kong (56 per cent).

Mobile payments in China quadrupled between 2015 and 2016 to reach US$9 trillion, not far behind cash transactions.

Online sales revenue in Asia is expected to triple in the period 2015 to 2021 to reach US$900 billion.

So selling online to Asian markets will continue to be an attractive option for many merchants and exporters.

Overall, Asia’s intra-regional trade will continue to rise, as it has been for the last few years.

As a region, its standing in the world economy will be stronger.

In a region where competition is stiff, quality can stand out. This is a selling point for New Zealand products and services.

Nothing is a given in Asia these days. So actively selling this proposition through stories and repeated messages is needed to establish a footing in any market in the region.

❚ Siah Hwee Ang is the BNZ chair in business in Asia and also chairs the enabling our Asia-Pacific trading nation distinctiveness theme at Victoria University.