The Best Countries to Do Business in Southeast Asia
Southeast Asia is steadily developing and becoming powerful independent member of international trade. It is a key market for a wide variety of goods and services – from cars, food, cosmetics and computers to wealth management services, insurance and international money transfers. The prosperity of this region is constantly growing, and it is becoming more attractive for foreign investors. Here are the best countries to run business in Southeast Asia and reasons to do business in it.
Digitalization
Disposable incomes in the region are increasing, a start-up sector is strengthening, and devices are becoming more accessible and cheaper. As a result, the number of digital consumers and the internet economy are growing too. This tendency changed many spheres starting from online retail and finishing by ride-sharing services. It also allows involving small and medium enterprises in global trade, opening and developing new industries, and driving the region’s economies towards economic integration.
For example, in 2015, the volume of online commerce in the 6 largest countries in Southeast Asia (Vietnam, Indonesia, Malaysia, Philippines, Singapore, and Thailand) was about $30 billion. According to a study conducted out by Temasek and Google, by 2025 it is likely to rise to $200 billion.
Disposable incomes in the region are increasing, a start-up sector is strengthening, and devices are becoming more accessible and cheaper. As a result, the number of digital consumers and the internet economy are growing too. This tendency changed many spheres starting from online retail and finishing by ride-sharing services. It also allows involving small and medium enterprises in global trade, opening and developing new industries, and driving the region’s economies towards economic integration.
For example, in 2015, the volume of online commerce in the 6 largest countries in Southeast Asia (Vietnam, Indonesia, Malaysia, Philippines, Singapore, and Thailand) was about $30 billion. According to a study conducted out by Temasek and Google, by 2025 it is likely to rise to $200 billion.
Low costs of doing business
To keep pace with rising living costs, the governments take measures to increase minimum and average wage rates. But still, in the most of Southeast Asian countries wages are relatively low in comparison with the western ones. Inexpensive and skilled labor force makes the expenses on doing business in Southeast Asia much lower. According to Viet Dragon Securities Company (VDSC), in 2021, Vietnam was one of ASEAN countries with the lowest labor costs with minimum wage of US$132-190 and average wage of US$265-320 per month.
Regional stability
Southeast Asia region has been stable for the past few decades. The absence of serious conflicts between countries facilitates many things. Those are economic and political stability, the decrease of poverty, and the emergence of a middle class that contributes a lot to regional and international economy.
Because of strained relations between US and China, US investors shifted their focus to the better alternative among Southeast Asian countries like Vietnam. Generally, the United States maintains a high degree of involvement in Southeast Asia.
To keep pace with rising living costs, the governments take measures to increase minimum and average wage rates. But still, in the most of Southeast Asian countries wages are relatively low in comparison with the western ones. Inexpensive and skilled labor force makes the expenses on doing business in Southeast Asia much lower. According to Viet Dragon Securities Company (VDSC), in 2021, Vietnam was one of ASEAN countries with the lowest labor costs with minimum wage of US$132-190 and average wage of US$265-320 per month.
Regional stability
Southeast Asia region has been stable for the past few decades. The absence of serious conflicts between countries facilitates many things. Those are economic and political stability, the decrease of poverty, and the emergence of a middle class that contributes a lot to regional and international economy.
Because of strained relations between US and China, US investors shifted their focus to the better alternative among Southeast Asian countries like Vietnam. Generally, the United States maintains a high degree of involvement in Southeast Asia.
The Best countries to do business in Southeast Asia
1) Vietnam
Vietnamese economy showed GDP increase of 6.6% in the second quarter of 2021, despite the ongoing Covid-19 pandemic. Such factors as abundance of natural resources, a growing number of internet users, a fast-growing middle class, and several free trade agreements contributed a lot to this.
In May 2021, import in Vietnam reached historical maximum and equaled $28.3 billion, while in April it was $27.8 billion. It shows that Vietnamese have high demand for international brands and their items. That’s why a lot of domestic businesses expand their relationships with foreign companies.
2) Malaysia
Malaysia has high GDP per capita and has one of the most sophisticated economies in Southeast Asia region. According to the World Bank, this country has one of the world’s most opened economies: its trade-to-GDP ratio equaled more than 115% in 2020. Openness to trade and investment policy has led to the increase of employment and wages in Malaysia.
3) Philippines
Philippines’ economy is considered to be relatively stable during the last decades. Several spheres including finance, agriculture and insurance weren’t damaged by the COVID-19 pandemic in 2020 and continued to grow in 2021. At the same time it is one of the fastest-growing economies in the world.
4) Indonesia
Indonesian population reached almost 280 million in 2021. According to statistics, nearly half of its population is made up of people under the age of 30 years. In addition to young generation that shows high demand for imported products, there is also rapidly growing middle class.
Private spending in Indonesia also contributes a lot to country’s GDP and accounts for 60% of it.
5) Singapore
This country is mainly attractive for investment in financial sector. Its government aims to become a worldwide fintech powerhouse and wants to take advantage of the shifting trends in the fintech industry to attract investors.
It turns out that the best country to run business in Southeast Asia is Vietnam. If you want to enter Vietnamese market and start selling your products there, Awesome products Co. can help you with it. We are a distribution company that offers such services as comprehensive FMCG marketing support including merchandising, promo activities, and on-shelves promotions.
Awesome products Co. can also help your company to enter major marketplaces in South East Asia, Europe, and North America. We have years of experience selling our brands on Lazada, Shopee, Tiki, Sendo, and Amazon in different countries. Contact us and start doing business in the most promising country in Southeast Asia by letting us solve all the hustle for you!
1) Vietnam
Vietnamese economy showed GDP increase of 6.6% in the second quarter of 2021, despite the ongoing Covid-19 pandemic. Such factors as abundance of natural resources, a growing number of internet users, a fast-growing middle class, and several free trade agreements contributed a lot to this.
In May 2021, import in Vietnam reached historical maximum and equaled $28.3 billion, while in April it was $27.8 billion. It shows that Vietnamese have high demand for international brands and their items. That’s why a lot of domestic businesses expand their relationships with foreign companies.
2) Malaysia
Malaysia has high GDP per capita and has one of the most sophisticated economies in Southeast Asia region. According to the World Bank, this country has one of the world’s most opened economies: its trade-to-GDP ratio equaled more than 115% in 2020. Openness to trade and investment policy has led to the increase of employment and wages in Malaysia.
3) Philippines
Philippines’ economy is considered to be relatively stable during the last decades. Several spheres including finance, agriculture and insurance weren’t damaged by the COVID-19 pandemic in 2020 and continued to grow in 2021. At the same time it is one of the fastest-growing economies in the world.
4) Indonesia
Indonesian population reached almost 280 million in 2021. According to statistics, nearly half of its population is made up of people under the age of 30 years. In addition to young generation that shows high demand for imported products, there is also rapidly growing middle class.
Private spending in Indonesia also contributes a lot to country’s GDP and accounts for 60% of it.
5) Singapore
This country is mainly attractive for investment in financial sector. Its government aims to become a worldwide fintech powerhouse and wants to take advantage of the shifting trends in the fintech industry to attract investors.
It turns out that the best country to run business in Southeast Asia is Vietnam. If you want to enter Vietnamese market and start selling your products there, Awesome products Co. can help you with it. We are a distribution company that offers such services as comprehensive FMCG marketing support including merchandising, promo activities, and on-shelves promotions.
Awesome products Co. can also help your company to enter major marketplaces in South East Asia, Europe, and North America. We have years of experience selling our brands on Lazada, Shopee, Tiki, Sendo, and Amazon in different countries. Contact us and start doing business in the most promising country in Southeast Asia by letting us solve all the hustle for you!
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