CEO of Enterprise Singapore Mr Png Cheong Boon pointed out 3 opportunities for ASEAN: (1) growing consumer spending, (2) increasing investment in infrastructure, and (3) e-commerce and digital economy.
At the ASEAN Conference, CEO of Enterprise Singapore Mr Png
spoke about the opportunities in ASEAN and how Enterprise Singapore can
support businesses to capture these opportunities.
opportunities for ASEAN
As ASEAN’s population is expected to increase from the
current 640 million to more than 710 million by 2030, the growing demand from a
young population which is “hungry for jobs, goods and services” and represents
what Mr Png called “exciting prospect for enterprises looking to grow their
Other than a young population, the number of households in
ASEAN earning more than S$10,000 per year is projected to reach 125 million by
2025. About 30% or 40 million of these will earn between S$25,000 and S$95,000
While the top spending categories of ASEAN consumers include
travel and leisure; health, beauty and wellness; fashion; and consumer
electronics, the consumer market also shows diversity in spending areas. For
example, outside of capital cities, penetration of foreign brands is whilst
generally low, is growing, as consumers are looking beyond functionality and
are concerned about safety, energy efficiency and good design.
The same trend is also observable in field of
infrastructure. The Asian Development Bank (ADB) estimates ASEAN’s annual
infrastructure investment needs at US$184 billion to expand networks of roads,
rail, ports and airports to facilitate the movement of people and goods.
“Given the high cost of such infrastructure, Southeast Asian
governments are turning to external financing to meet some of these
commitments. More projects will be delivered as public-private partnerships
(PPPs),” said Mr Png.
“PPPs will bring in private capital and expertise, but are
more complex to structure. This creates opportunities for engineering, legal
and financial services firms with experience in preparing commercially-viable
infrastructure PPPs,” he explained.
E-Commerce and the digital economy was named by Mr Png as
the third area of growth.
According to Mr Png, the region’s online economy is
projected to be worth more than US$200 billion by 2025, growing at a 10-year
compound annual growth rate of 27%. By then, it will account for 6% of the
region’s GDP, three times today’s contribution.
He pointed out that business-to-consumer (B2C) e-commerce
platforms is the fastest growing pillar of the internet economy, expected to
grow eight times to US$88 billion by 2025.
“As more consumers go online, there will be new
possibilities to deliver more services online,” he said.
3 ways Singapore
companies can capture the opportunities
Mr Png highlighted 3 opportunities for Singapore companies.
The first one lies in platforms. He noted that most
e-commerce marketplaces have grabbed most of the attention but other verticals,
such as education, entertainment and healthcare, remain underdeveloped.
In supporting services, online commerce and services require
many of the same services as the real economy. These include payments,
insurance, logistics and fulfilment, fraud detection, marketing and customer
In supporting infrastructure, Mr Png pointed out that the
digital economy will still depend on many brick and mortar services, such as
fulfilment centres for e-commerce, data centres and logistic infrastructure.
To tap these opportunities, he emphasised that companies “must
adopt market-specific strategies” by: (1) customising products for the market,
(2) working through the right channels to reach the customer, and (3) choosing
the right partners.
The role of
Enterprise Singapore in supporting Singapore companies
“Today, more than half the 7,000 MNCs here run their
Asia-Pacific business out of Singapore, taking advantage of our strong
transport and trading links; the presence of global financial and professional
firms that are familiar with the region, and the availability of a diverse
talent pool that is familiar with doing business in ASEAN. Similarly, Singapore
companies can leverage the availability of finance and trading infrastructure,
as well as talent network to help them venture into the region,” said Mr Png.
In fact, Enterprise Singapore as Singapore’s enterprise
development agency, has been work closely with stakeholders and partners and put
in place a range of assistance that can help Singapore companies ease their
entry into other ASEAN markets.
There are programmes such as: (1) the Plug
& Play Network (PPN) which offers a list of in-market advisors,
business matching partners and co-working spaces for quick set-up, (2) eight overseas
centres in ASEAN to help companies identify suitable local partners, and (3) the
Assistance (MRA) Grant to help companies set up office or conduct
feasibility studies when expanding into new markets.
To preparing Singapore companies, business people and
students to ride the fast-growing digital economy in ASEAN, Enterprise
Singapore, together with the Economic Development Board, has launched the Global
Innovation Alliance (GIA) network in Jakarta and Bangkok.
The GIA network connects Singapore startups to the local
innovation and business community, enables partnerships and facilitates market
access, and this in turn creates opportunities for entrepreneurs and students
to be exposed to these markets.
Enterprise Singapore also offer the Productivity
Solutions Grant (PSG) and Enterprise
Development Grant (EDG) to help SMEs develop new products and digitalise
Mr Png also mentioned Infrastructure Asia which is jointly
set up by the Monetary Authority of Singapore and Enterprise Singapore to bring
together the networks and capabilities of public sector agencies, engineering
firms, global and multilateral financial institutions, and global professional
services firms, to help catalyse more infrastructure projects to meet Asia’s
infrastructure needs. He said that more details on Infrastructure Asia’s programmes
will be shared later this year.
On developing Southeast Asia-ready talent, Enterprise
Singapore has been working hand-in-hand with companies and partners to roll out
various talent development programmes such as the Go Southeast Asia Award,
which matches undergraduates keen on regional careers to Singapore companies
providing internships in their operations in Southeast Asia, and the Professional
Conversion Programme (PCP) for mid-career professionals looking for a new
“Southeast Asia represents a significant growth
market for companies and increasingly, also a source of innovation. To tap
these opportunities, companies need to develop a better understanding of these
markets, tailor their products and solutions to these markets, and work with
local partners. Enterprise Singapore has put in place several programmes to
assist Singapore enterprises in this aspect, and will step up our efforts to do
so. We hope more Singapore companies especially SMEs will leverage on these programmes
as they venture into ASEAN,” My Png concluded.
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