A melting pot in every sense, Southeast Asia has more than 650 million inhabitants, making it one of the world’s most populous and diverse regions. The region — composed of the countries Brunei, East Malaysia, East Timor, Indonesia, the Philippines, and Singapore, as well as Cambodia, Myanmar, Laos, Thailand, Malaysia, and Vietnam — is not only a great area for tourists, it’s a great place to do business.
Southeast Asia is one of the world’s fastest growing economies, with the region representing 3.4% of the global GDP. This is mainly due to its large, young population as well as its fast-emerging middle class. The region will only increase in economic significance within the coming decades.
This makes Southeast Asia incredibly attractive to global corporations who want to invest in promising, high-return markets other than America and Europe.
Here are some reasons you should consider doing business in Southeast Asia:
For the past 60 years, Southeast Asia has experienced a steady improvement in its economy, a development capped by the region becoming a hotspot for industrialization. This is most apparent in Singapore, Thailand, and the Philippines, all of which experienced significant developments in the manufacturing sector: electronics and transport equipment for Singapore, chemicals for Thailand, and textiles for the Philippines.
Due to the strong economic growth it experienced over the last several years, the number of people in Southeast Asia who could be defined as middle class — i.e., people with disposable income of around USD $16-$100 a day, now numbers in hundreds of millions.
Taking the pandemic into consideration, consumer spending is at an all-time high in Southeast Asia. An increasing number of Southeast Asians now have more money to spend on properties, cars, electronic gadgets, education, and luxury items. It’s the perfect market for new products and services.
Most of the countries in Southeast Asia are business-friendly, making them attractive to foreign investors who may want to open up businesses in the region.
Singapore offers low taxes for companies, as well as an easy setup scheme for new businesses which allows entrepreneurs to register a company — whatever their business ownership structure may be — within one day with a capital of just SGD 1. Malaysia offers tax incentives for companies in the manufacturing, biotechnology, and health service industries, while Thailand gives special support to technology companies.
Foreign investors are also welcome to put up a business in the Philippines — provided, of course, that they have local shareholders and that they belong in industries that are not among those that are restricted in the country’s Negative Investment List.
According to a study conducted in part by Google, Thais, Filipinos, Indonesians, and Malaysians spend the most time in the world accessing the internet through their smartphones and other mobile devices. This uptick in internet usage has led to an increase in the use of e-commerce and digital service companies, such as online media, ride hailing, and online shopping — an increase that has helped push the region’s internet economy past the USD 100 billion mark in 2019.
When it comes to online shopping, Filipinos are big spenders in the region, with the country’s internet economy reaching a value of USD 7.5 billion in the same year.
This makes the country — and the rest of the region — the perfect location for a budding e-commerce business or a similar venture.
Southeast Asia, for all its developments, still hosts untapped potential for investors and business owners. It must be noted, however, that those who want to invest in the region still need to get accustomed to its business laws, regulations and prerequisites.
Not only that, but aspiring business owners will have to be more than familiar with market-specific issues such as the construction of infrastructure, the hiring of employees, and the marketing and advertising of one’s goods and services.
If you are thinking of starting your corporation in the Philippines, call FilePino.
Composed of a team of professionals and experts, FilePino offers a full range of corporate services that can help you get your company up and running in no time.
Get in touch with us at +1.806.553.6552 or send us a message here.