IN 2013 LOOK FOR SOUTHEAST ASIAN ROARING TIGERS !!

According to OECD's latest forecast, Southeast Asia's economic growth will return to a 'robust' pre-crisis average of 5.5% over the next five years. The 10 economies of the Association of Southeast Asian nations will show resilience to the predicted slowdown of China and India. Brunei, Burma (Myanmar), Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand and Vietnam will be insulated by a combining shift to domestic demand rather than exports as the main driver of economic growth. The expansion of the middle class and private consumption will continue to boost demand for education, healthcare and durable goods such as cars and household appliances.

Part of the Southeast Asia's large market potential emanates from its rapidly growing middle class. In Indonesia, for example, the middle class comprises approximately 40% of the population or more than 90 million people. Within the next 4 to 10 years, this block of consumers is expected to grow to more than 150 million. Signifiant opportunities continue to beackon early movers in Southeast Asia's production sector such as manufacturing, infrastructure, construction, mining, logistics, agribusiness, telecommunications as well as service sectors such as business process outsourcing, healthcare, medicine and tourism.

Southeast Asia has benefited from foreign capital inflows influenced by government initiatives to attract inbound investment (e.g. Malaysia). Also rising production costs in China have shifted manufacturing and production momentum to Southeast Asia where countries in the ASEAN such as Indonesia and Vietnam have gained ground as low-cost production venues especially for labor intensive manufacturing.

In addition to manufacturing and production, Southeast Asia's large pool of low cost yet skilled labor has also created opportunities for the offshoring and outsourcing of services e.g. the Philippines. Southeast Asia's rich reserve of highly skilled workers will also spur the introduction of new and advanced technologies for providing high value goods. This can in turn increase the region's gross national income and raise internal demand for international goods.

Finally, Southeast Asia is rich in natural resources such as coal, palm oil, copper, nickel, aluminium and other minerals that are in deep demand worldwide.

Doing business with government entities in Southeast Asia is complex and fraught with rules and bureaucracy. Corruption is a constant and very real concern. Lack of uniformity and consistency in government policies may also pose a challenge. More efforts should be made to improve transparency, efficiency and public policy advocacy.

The objective should be to reduce social and economic differences between ASEAN nations. Today, huge disparities in GDP per capita exist in the region with faster rise in the ASEAN-6 group of Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand than in Cambodia, Laos, Myanmar and Vietnam (CLMV). Vietnam has been the most successful CLMV country in closing the gap with its wealthier neighbours and reducing domestic disparities, although inflation is a concern. Cambodia has been slow in catching up, but has managed to reduce inequality at home. Laos has  caught up quickly but at the cost of widening domestic disparities.