I am often asked ‘Why Southeast Asia?’ and I have written many articles and blogs about this. But, this time, I just want to illustrate the ‘why’ with some interesting charts/graphs.
Statista (2020) https://www.statista.com/chart/22256/biggest-economies-in-the-world-timeline/
If the above doesn’t make you sit up, then nothing will. The top five economies in 2024 will be in Asia. And the countries in Southeast Asia are right at the centre of these countries. This means that they are going to be part of the supply chain for these countries.
Then, there’s the CPTPP and RCEP.
That’s the Comprehensive and Progressive Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership. The UK has applied to join the CPTPP. Why? Well, before I answer that, let’s look at the RCEP.
Statista (2020) https://www.statista.com/chart/23503/combined-gdp-of-regional-trade-blocs/
In terms of size, it’s larger than the EEA and the North American trade region. That’s a big deal. Now, let me address the why.
In the diagram above, we see the overlap between the CPTPP and the RCEP. Despite years of trying, the EU has not yet made any significant headway with a trade deal with China. But with the UK joining the CPTPP, it’s entirely possible to have a trade deal with one of the largest economies in the world.
But the benefits don’t stop there.
Those countries in the centre of the diagram, will have unparalleled access to both the CPTPP and RCEP. And, except for Australia, Japan, and New Zealand, they are based in Southeast Asia.
So, why is it important? In a world of instant gratification and where speed is essential, frictionless (I couldn’t help myself!) trade is a must. Having access to markets in these countries allows businesses to trade quickly and without hurdles. And your competitors are either looking at these countries strategically or in there already.
Can businesses wait?
Of course. Just like any other race, you can wait at the starting line when the gun goes off and give your competitor a head start. It would be unconventional, to say the least, and let’s be honest, it’s just not the done thing.
If your business wants to be competitive, and for more information about how we can help, visit our website or contact us on 07885 784783 or kiley.tan@mosaicint.co.uk.