This was the first time I was in Indonesia during Idul-Fitri, or Lebaran, when Indonesians celebrate the end of Ramadan, the Muslim vasting month. I was warned that travelling in the days around Lebaran would be hazardous as millions of Indonesians are leaving the cities to go home to their home towns to celebrate the occasion with family members.
This massive exodus is called "mudik" or, jokingly, "pulang kampung" (going home to the village). When American President Obama visited Indonesia in November 2010, one of the few words Bahasa Indonesia he remembered was pulang kampung, he was saying in his speech at the Universitas Indonesia (UI). A big round of applause and laughter followed.
As it is in Thailand during Songkhran (Thai New Year) in April, when millions of Thais are leaving the capital of Bangkok to travel upcountry, the Indonesian capital of Jakarta is virtually empty during Lebaran. No traffic jams this time, but deserted streets. Even the ever-crowded, numerous shopping malls in the city are quiet. The only people visiting the malls are the Chinese, who, largely being Christian, do not celebrate Lebaran.
In 2011, the Indonesian government made the mistake of, at the last moment, declaring Lebaran officially on August 31st, while neighbouring Malaysia, Brunei and Singapore marked a day earlier, August 30th, as the official day which ended the vasting month. This caused confusion and even anger among Indonesians as they had to postpone their planned celebrations with another day.
As a result that year's mudik became even more chaotic as travel plans had to be changed overnight. Popular mudik routes such as Bandung-Garut and Bandung-Subang, which are usually 2-3 hour journies, became 8-9 hour nightmares with an endless stream of cars and motorcycles filling up the roads.
In the days leading up to Lebaran I was intrigued by seeing people offering packages of brand new bank notes for sale along the street. I was told that, as it is custom to hand out money to small children within in the family during Lebaran, one prefers giving new crispy bank notes over old fumbly dirty bank notes. Creative as Indonesians are, for a few extra Rupiahs you can buy packages of new bank notes from these street vendors!
This article appeared earlier in e-magazine Business Trends Asia
Tuesday, July 15, 2014
Wednesday, October 23, 2013
Love and marriage in Indonesia
Although Indonesian society has dramatically changed over the past few decades, it still remains a traditional one with a wide variety of rituals and social and culturally-determined customs. Even today, in more modern Indonesia, youngsters struggle with issues related to, for example, love and sex.
In a traditional, family-oriented society like Indonesia, boys and, in particular, girls, are supposed to refrain from sex (read; intercourse) until they are married. The vast majority of Indonesia's youngsters not only accepts, but also completely agrees with, this situation and voluntarily obeys by this rule. The ultimate goal of a love affair is getting married.
This is not specific Indonesian, however, but applies to most countries in Asia. But in Indonesia, predominantly in Sundanese (West Java) and Javanese (Central and East Java) culture, lovers have to deal with one extra condition; Indonesian young women and young men have to respect their elder sibling(s) when it comes to marriage. This means that a young woman or man can only marry when her/his elder sibling is already married. In order not to "embarass" her/his older sibling, the younger one has to wait until the older one is "safely" married.
What is the implication of this condition ? It can have a dramatic impact on the lives of young men and women in Indonesia and may even result in broken-off love relationships out of respect for older sisters. This especially applies for highschool or college love affairs whereby lovers may have to wait for several years, sometimes even a decade, before being "allowed" to get married.
Lovers may have to end their relationship because an older sibling is blocking the way to their marriage. Keeping the other "on a string" would not be fair. Instead, breaking off the relationship will set the other free and create new, better chances, for a love relationship that doés have the potential of resulting in marriage. Occasionally, however, the younger brother or sister does get the green light after having asked the older sibling special permission to marry first.
This article appeared earlier in e-magazine Business Trends Asia
In a traditional, family-oriented society like Indonesia, boys and, in particular, girls, are supposed to refrain from sex (read; intercourse) until they are married. The vast majority of Indonesia's youngsters not only accepts, but also completely agrees with, this situation and voluntarily obeys by this rule. The ultimate goal of a love affair is getting married.
This is not specific Indonesian, however, but applies to most countries in Asia. But in Indonesia, predominantly in Sundanese (West Java) and Javanese (Central and East Java) culture, lovers have to deal with one extra condition; Indonesian young women and young men have to respect their elder sibling(s) when it comes to marriage. This means that a young woman or man can only marry when her/his elder sibling is already married. In order not to "embarass" her/his older sibling, the younger one has to wait until the older one is "safely" married.
What is the implication of this condition ? It can have a dramatic impact on the lives of young men and women in Indonesia and may even result in broken-off love relationships out of respect for older sisters. This especially applies for highschool or college love affairs whereby lovers may have to wait for several years, sometimes even a decade, before being "allowed" to get married.
Lovers may have to end their relationship because an older sibling is blocking the way to their marriage. Keeping the other "on a string" would not be fair. Instead, breaking off the relationship will set the other free and create new, better chances, for a love relationship that doés have the potential of resulting in marriage. Occasionally, however, the younger brother or sister does get the green light after having asked the older sibling special permission to marry first.
This article appeared earlier in e-magazine Business Trends Asia
Wednesday, April 17, 2013
Coming up in April and May...
3 April: Amsterdam University of Applied Sciences
Workshop on “Added Value of Dutch Graduates in Asia”,
at Career Day
18 April: Royal Tropical Institute, Amsterdam
Training on Social Culture in Singapore
25 April: Chamber of Commerce Amsterdam
Consultant Southeast Asia at Consult Day Asia-Latin America
2 May: Royal Tropical Institute, Amsterdam
Training on Social Culture in Singapore
16 May: Mead Johnson, Nijmegen
Workshop on Social Culture in Thailand and the Philippines,
in association with the Royal Tropical Institute
21 May: Netherlands Council for Trade Promotion /
Dutch Development Bank, The Hague
Guest speaker at seminar “Sowing the Seeds of Success in Southeast Asia”
_____________________________________________________________________________
For more information, Business Trends Asia
Friday, January 18, 2013
Culture clashes in HK, Singapore
In economic powerhouse China, an extremely wealthy upper-class has emerged in recent years. International luxury brands have rushed to the country to cater to the wealthy mainland Chinese. This same group of rich Chinese has started to venture out of the country, whether for leisure trips, for medical care, or to acquire property overseas.
Apart from long-haul destinations in Europe and the Americas, places in the Asian region have become popular spots for mainland Chinese to visit. As far as international visitor numbers to the Indonesian island of Bali are concerned, for example, the Chinese are closing in on the traditional source markets of Australia and Japan. And cities and resort areas in Thailand and Vietnam are also welcoming increasing numbers of Chinese tourists. At the same time, Asian cities such as Hong Kong, Singapore and Bangkok have become popular shopping destinations for Chinese.
In particular Hong Kong has seen an spectacular infux of mainland Chinese, whether for shopping or for medical care. Over 28 million mainland Chinese visited Hong Kong in 2011, an increase of 60% since 2008. Mainland Chinese buyers accounted for around 20% of purchases of apartments in Hong Kong, last year. Along with contributing economically to Hong Kong, they also bring their own cultural identity, which sometimes clashes with that of Hong Kong citizens.
A recent trend whereby pregnant mainland Chinese women travel to Hong Kong to deliver their child and thus receiving better medical care as well as Hong Kong residency status, has enraged Hong Kong’s 7 million citizens. Estimates indicate that 4 out of 10 births in Hong Kong in 2011 were from mainland Chinese and the Hong Kong authorities have now lowered (and pledged to actually enforce !) quotas on births from mainland Chinese.
In recent months, there have been several incidents in Hong Kong whereby the culture of the so-called “sophisticated” Hong Kong Chinese clashed with the culture of the “nouveau-riche farmers” from the mainland: quarrels, even fights, in the subway, cynical writings on Facebook and blogs mocking the rude behaviour of mainland Chinese.
A similar culture clash is currently taking place is in Singapore. Although the majority of the population in Singapore is ethnic-Chinese and the island-nation’s political and economic power is controlled by ethnic-Chinese, Singaporeans consider themselves a world apart from mainland Chinese. The recent influx of mainland Chinese tourists, businessmen and students has resulted in anger and nationalism among Singaporeans.
Singapore’s thriving real estate sector is dominated not only by wealthy (primarily ethnic-Chinese) Indonesians, but also by mainland Chinese, who are buying exclusive US$500,000- 1,000,000+ condominiums.
In May 2012, a mainland Chinese businessmen crashed his brand-new Ferrari into a taxi, thereby killing himself and 2 others. This accident outraged Singaporeans and further fueled the anti-mainland Chinese sentiment in Singapore. Harsh anti-Chinese comments were posted on social media. Other voices in Singapore are expressing their concern over the increasingly heated anti-mainland Chinese debate in the country.
Although Singapore is an immigrant society with third-, or fourth generation immigrants from China and India, the cultural divide between the Singaporean Chinese and the newcomers from mainland China is deep.
This article appeared earlier in e-magazine Business Trends Asia
Apart from long-haul destinations in Europe and the Americas, places in the Asian region have become popular spots for mainland Chinese to visit. As far as international visitor numbers to the Indonesian island of Bali are concerned, for example, the Chinese are closing in on the traditional source markets of Australia and Japan. And cities and resort areas in Thailand and Vietnam are also welcoming increasing numbers of Chinese tourists. At the same time, Asian cities such as Hong Kong, Singapore and Bangkok have become popular shopping destinations for Chinese.
In particular Hong Kong has seen an spectacular infux of mainland Chinese, whether for shopping or for medical care. Over 28 million mainland Chinese visited Hong Kong in 2011, an increase of 60% since 2008. Mainland Chinese buyers accounted for around 20% of purchases of apartments in Hong Kong, last year. Along with contributing economically to Hong Kong, they also bring their own cultural identity, which sometimes clashes with that of Hong Kong citizens.
A recent trend whereby pregnant mainland Chinese women travel to Hong Kong to deliver their child and thus receiving better medical care as well as Hong Kong residency status, has enraged Hong Kong’s 7 million citizens. Estimates indicate that 4 out of 10 births in Hong Kong in 2011 were from mainland Chinese and the Hong Kong authorities have now lowered (and pledged to actually enforce !) quotas on births from mainland Chinese.
In recent months, there have been several incidents in Hong Kong whereby the culture of the so-called “sophisticated” Hong Kong Chinese clashed with the culture of the “nouveau-riche farmers” from the mainland: quarrels, even fights, in the subway, cynical writings on Facebook and blogs mocking the rude behaviour of mainland Chinese.
A similar culture clash is currently taking place is in Singapore. Although the majority of the population in Singapore is ethnic-Chinese and the island-nation’s political and economic power is controlled by ethnic-Chinese, Singaporeans consider themselves a world apart from mainland Chinese. The recent influx of mainland Chinese tourists, businessmen and students has resulted in anger and nationalism among Singaporeans.
Singapore’s thriving real estate sector is dominated not only by wealthy (primarily ethnic-Chinese) Indonesians, but also by mainland Chinese, who are buying exclusive US$500,000- 1,000,000+ condominiums.
In May 2012, a mainland Chinese businessmen crashed his brand-new Ferrari into a taxi, thereby killing himself and 2 others. This accident outraged Singaporeans and further fueled the anti-mainland Chinese sentiment in Singapore. Harsh anti-Chinese comments were posted on social media. Other voices in Singapore are expressing their concern over the increasingly heated anti-mainland Chinese debate in the country.
Although Singapore is an immigrant society with third-, or fourth generation immigrants from China and India, the cultural divide between the Singaporean Chinese and the newcomers from mainland China is deep.
This article appeared earlier in e-magazine Business Trends Asia
Monday, August 27, 2012
Asia's power women offer false hope
Asia's high profile powerful women have often been considered by their country's poor as their saviour, as the ones who will tear down corrupt institutions and modernize the country, bringing economic prosperity for all and allowing the poor to break the cycle of poverty which often entraps families for generations in destitute circumstances.
Benazir Bhutto in Pakistan, Aung San Suu Kyi in Myanmar, Yinluck Shinawtra in Thailand, Megawati Sukarnoputri in Indonesia and Corazon Aquino and Gloria Macapagal Arroyo in the Philippines. All had an aura of fairness, honesty, held the promise of change for the good and a clean government when they assumed power for the first time. With the exception of Aung San Suu Kyi in Myanmar who has not held official power, all the female leaders of their countries failed to live up to promise and hope instilled on them by their constituents also falling into the trap of corrupt government politics themselves, achieving nothing for their people and country.
But these women were portrayed as something they were/are not: fighters for the common people. The Asian Power Women all belong(ed) to their country's power pinnacle class.
Benazir Bhutto was the daughter of Zulfikar Ali Bhutto, a former prime minister and president of Pakistan and founder of the Pakistan People's Party that Benazir Bhutto led from the age of 29. Benazir Bhutto was Pakistan's prime minister from 1988 to 1990 and 1993 to 1996. Benazir Bhutto's paternal grandfather was Sir Shah Nawaz Bhutto. Originally of Sindh, Shah Nawaz Bhutto became the prime minister of the princely state of Junagadh in what is now Gujarat State in India. During his services Shah Nawaz Bhutto had been given large tracts of land in Sindh Province and after the partition of British India into India and Pakistan, he moved his family there, being one of the wealthiest and therefore most influential, land owners.
Aung San Suu Kyi is the daughter of Aung San (real name: Htein Lin, born on February 13, 1915), founder of the modern Burmese army, of Burma's Communist Party and one of the negotiators of Burma's independence in 1947. Aung San was the son of a lawyer and born into a family active in the anti-British resistance movement, dating back to the attachment of Burma to the British Empire in 1886. Aung San Suu Kyi comes therefore from a very well established political family.
As a small group of tourists found out in December 2011, when stepping on a boat to float down the Irrawaddy River surrounded by the UNESCO-classified temples of Pagan. The boat guide pointed out two huge buildings arising along the river shore, in the middle of nowhere. According to the guide, the pompuous villa belonged to a family member of Aung San Suu Kyi and the other high-rise building was being constructed by an army general. When the tourists asked the guide what he thought of all this, he shrugged his shoulders, acknowledging the fact that only the rich and connected can engage in projects like this.
Yingluck Shinawatra who became Thailand's (first female) prime minister in 2011 is the youngest sister of Thaksin Shinawatra, one of Thailand's wealthiest people and a former prime minister himself. His third time in office ended on 19 September 2006 when a military coup d'état ended civilian rule. The Shinawatra family appears not to belong to the traditional power classes of Thailand. Thaksin has always promoted an image of himself as an outsider, a self-made man with no ties to the old upper classes. He became prime minister on a platform of some populist policies e.g. subsidies for rice farmers in the northeast of the country. His enormous popularity among Thailand's common people, based on creating awareness that they have a voice and rights too, allowed him to create a formidable personal power base, totally separate from the traditional power classes: the nobility, the armed forces and the Teochiu business elite.
But Thaksin's image is a PR exercise, aimed at attracting the vote of Thailand's increasingly vocal working class. The Shinawatra family is Hakka and not Teochiu as the majority of Thailand's ethnic Chinese population. The Teochiu run Thailand's economy and the Hakka Shinawatra family are not part of this inner circle. But this does not mean that they are outsiders. As detailed in article Thaksin: from Rich to Richer, the Shinawatra family has very well established ties with Thailand's aristocracy, dating back to the reign of Rama IV in middle of the 19th century and has been part of Thailand's power elite for many generations.
Thaksin Shinawatra's political agenda was and still is aimed at gaining power at the expense of the Thailand's traditional ruling classes. This will also support their commercial interests. Yingluck Shinawatra is Thaksin's replacement but she has her family's and brother's interests at heart. Her government's policies of supporting Thailand's poor and working class are means to an end (i.e. creating and cementing a political power base) and not based on a heartfelt desire to create a more just society.
Corazon Aquino was the Philippines's first democratically elected president after the removal of dictator Ferdinand Marcos in 1986. Corazon Aquino was the widow of senator Benigno Aquino Jr., Marcos' political opponent who was murdered on Marcos' instructions upon his return to the Philippines from exile in the USA in 1983. Corazon Aquino became the leader and the public face of the people's revolution against Marcos that drove him from office. With her friendly and motherly appearance she became to many Filipino's the mother of the nation who only had the best interests of poor and common Filipino's at heart. And as a mother she would protect her children from poverty and abuse and create a country in which all people could have a decent living and the rich would not treat the poor as their servants without any rights.
But Corazon Aquino's maiden name is Cojuangco which is one of the Philippine's richest families, with enormous commercial interests and political cloud dating back to colonial times. The family is one of the largest land owners of the country and as such any land reform transferring land ownership to poor farmers is directly opposed to the Cojuangco's family interests. In all fairness Corazon Aquino did implement a radical land reform programme which affected also the Hacienda Luisita, a 6,435 hectare sugar cane plantation and one of the largest estates in the country and owned by the Cojuangco family. In the end Corazon Aquino was not able to beat her own family and establish land reform on their own plantation. Since 2004 the Cojuangco/Aquino family is even engaged in a direct battle with its plantation workers which has involved strikes, blockades and even lethal confrontation.
One of Corazon Aquino's successors, Gloria Macapagal Arroyo, was also swept to power on the wings of popular. Originally a Vice President of the Philippines under then President Joseph Estrada (1998 - 2001) she turned against him when he came under investigation and eventually impeachment for massive corruption. During the so-called EDSA II revolution of January 17-20, the popular revolt against Joseph Estrada, Gloria Macapagal Arroyo was sworn in as president. She promised a continuation of the investigations against Joseph Estrada, clean government and a fight against corruption.
Gloria Macapagal Arroyo is the daughter of Diosdado Macapagal, president of the Philippines in the years 1961-1965. The Macapagal family belong to the Philippine's traditional political power structure together with the Magsaysay and Aquino families. Maintaining traditional power structures is in their interest, not political reform and clean government. Gloria Macapagal was eventually also confronted with corruption charges against herself focussing on election fraud in 2004, as well as her husband, Jose Miguel Arroyo, who supposedly abbused his position of "First Gentleman" for his own financial gain.
This article appeared earlier in e-magazine Business Trends Asia
Benazir Bhutto in Pakistan, Aung San Suu Kyi in Myanmar, Yinluck Shinawtra in Thailand, Megawati Sukarnoputri in Indonesia and Corazon Aquino and Gloria Macapagal Arroyo in the Philippines. All had an aura of fairness, honesty, held the promise of change for the good and a clean government when they assumed power for the first time. With the exception of Aung San Suu Kyi in Myanmar who has not held official power, all the female leaders of their countries failed to live up to promise and hope instilled on them by their constituents also falling into the trap of corrupt government politics themselves, achieving nothing for their people and country.
But these women were portrayed as something they were/are not: fighters for the common people. The Asian Power Women all belong(ed) to their country's power pinnacle class.
Benazir Bhutto was the daughter of Zulfikar Ali Bhutto, a former prime minister and president of Pakistan and founder of the Pakistan People's Party that Benazir Bhutto led from the age of 29. Benazir Bhutto was Pakistan's prime minister from 1988 to 1990 and 1993 to 1996. Benazir Bhutto's paternal grandfather was Sir Shah Nawaz Bhutto. Originally of Sindh, Shah Nawaz Bhutto became the prime minister of the princely state of Junagadh in what is now Gujarat State in India. During his services Shah Nawaz Bhutto had been given large tracts of land in Sindh Province and after the partition of British India into India and Pakistan, he moved his family there, being one of the wealthiest and therefore most influential, land owners.
Aung San Suu Kyi is the daughter of Aung San (real name: Htein Lin, born on February 13, 1915), founder of the modern Burmese army, of Burma's Communist Party and one of the negotiators of Burma's independence in 1947. Aung San was the son of a lawyer and born into a family active in the anti-British resistance movement, dating back to the attachment of Burma to the British Empire in 1886. Aung San Suu Kyi comes therefore from a very well established political family.
As a small group of tourists found out in December 2011, when stepping on a boat to float down the Irrawaddy River surrounded by the UNESCO-classified temples of Pagan. The boat guide pointed out two huge buildings arising along the river shore, in the middle of nowhere. According to the guide, the pompuous villa belonged to a family member of Aung San Suu Kyi and the other high-rise building was being constructed by an army general. When the tourists asked the guide what he thought of all this, he shrugged his shoulders, acknowledging the fact that only the rich and connected can engage in projects like this.
Yingluck Shinawatra who became Thailand's (first female) prime minister in 2011 is the youngest sister of Thaksin Shinawatra, one of Thailand's wealthiest people and a former prime minister himself. His third time in office ended on 19 September 2006 when a military coup d'état ended civilian rule. The Shinawatra family appears not to belong to the traditional power classes of Thailand. Thaksin has always promoted an image of himself as an outsider, a self-made man with no ties to the old upper classes. He became prime minister on a platform of some populist policies e.g. subsidies for rice farmers in the northeast of the country. His enormous popularity among Thailand's common people, based on creating awareness that they have a voice and rights too, allowed him to create a formidable personal power base, totally separate from the traditional power classes: the nobility, the armed forces and the Teochiu business elite.
But Thaksin's image is a PR exercise, aimed at attracting the vote of Thailand's increasingly vocal working class. The Shinawatra family is Hakka and not Teochiu as the majority of Thailand's ethnic Chinese population. The Teochiu run Thailand's economy and the Hakka Shinawatra family are not part of this inner circle. But this does not mean that they are outsiders. As detailed in article Thaksin: from Rich to Richer, the Shinawatra family has very well established ties with Thailand's aristocracy, dating back to the reign of Rama IV in middle of the 19th century and has been part of Thailand's power elite for many generations.
Thaksin Shinawatra's political agenda was and still is aimed at gaining power at the expense of the Thailand's traditional ruling classes. This will also support their commercial interests. Yingluck Shinawatra is Thaksin's replacement but she has her family's and brother's interests at heart. Her government's policies of supporting Thailand's poor and working class are means to an end (i.e. creating and cementing a political power base) and not based on a heartfelt desire to create a more just society.
Corazon Aquino was the Philippines's first democratically elected president after the removal of dictator Ferdinand Marcos in 1986. Corazon Aquino was the widow of senator Benigno Aquino Jr., Marcos' political opponent who was murdered on Marcos' instructions upon his return to the Philippines from exile in the USA in 1983. Corazon Aquino became the leader and the public face of the people's revolution against Marcos that drove him from office. With her friendly and motherly appearance she became to many Filipino's the mother of the nation who only had the best interests of poor and common Filipino's at heart. And as a mother she would protect her children from poverty and abuse and create a country in which all people could have a decent living and the rich would not treat the poor as their servants without any rights.
But Corazon Aquino's maiden name is Cojuangco which is one of the Philippine's richest families, with enormous commercial interests and political cloud dating back to colonial times. The family is one of the largest land owners of the country and as such any land reform transferring land ownership to poor farmers is directly opposed to the Cojuangco's family interests. In all fairness Corazon Aquino did implement a radical land reform programme which affected also the Hacienda Luisita, a 6,435 hectare sugar cane plantation and one of the largest estates in the country and owned by the Cojuangco family. In the end Corazon Aquino was not able to beat her own family and establish land reform on their own plantation. Since 2004 the Cojuangco/Aquino family is even engaged in a direct battle with its plantation workers which has involved strikes, blockades and even lethal confrontation.
One of Corazon Aquino's successors, Gloria Macapagal Arroyo, was also swept to power on the wings of popular. Originally a Vice President of the Philippines under then President Joseph Estrada (1998 - 2001) she turned against him when he came under investigation and eventually impeachment for massive corruption. During the so-called EDSA II revolution of January 17-20, the popular revolt against Joseph Estrada, Gloria Macapagal Arroyo was sworn in as president. She promised a continuation of the investigations against Joseph Estrada, clean government and a fight against corruption.
Gloria Macapagal Arroyo is the daughter of Diosdado Macapagal, president of the Philippines in the years 1961-1965. The Macapagal family belong to the Philippine's traditional political power structure together with the Magsaysay and Aquino families. Maintaining traditional power structures is in their interest, not political reform and clean government. Gloria Macapagal was eventually also confronted with corruption charges against herself focussing on election fraud in 2004, as well as her husband, Jose Miguel Arroyo, who supposedly abbused his position of "First Gentleman" for his own financial gain.
This article appeared earlier in e-magazine Business Trends Asia
Thursday, May 24, 2012
Thesis on Further East Consult product portfolio
Tuesday, March 27, 2012
Thailand - Great alternative to China
I have been warning foreign companies, in particular SMEs, about entering the Chinese market for a number of years now. Finally now, European entrepreneurs are beginning to realize that it is tough, for most even impossible, to make money in China. Even with substantial investment funds and a large dose of stamina, it is extremely difficult for a foreign enterprise to be succesful in China. Since the beginning of this century, there have been numerous examples of foreign companies, both multinationals and SMEs, that have withdrawn from the Chinese market and have taken their losses.
Foreign companies in China’s services sector hardly succeed in expanding beyond servicing óther foreign companies in China, whether financial services or otherwise. Although this phenomena, whereby it proves hard to build up a local client base, is not unique to China and forms an obstacle in many other Asian countries too, in China it is more prominently the case.
Foreign retail formulas in China are struggling with an increasing number of local competitors, unpredictable quality and pricing demands and changing labour laws.
In the last few years, foreign direct investment (FDI) in Southeast Asia (up 16% versus 2010) is outgrowing FDI growth (8%) into China. In 2011, China received US$124 billion of FDI, whereas Southeast Asia received US$209 billion of FDI. There’s a clear trend of foreign investors shifting their focus away from China to other markets in South and Southeast Asia.
Thailand’s “mature” economy
One of the most “mature” markets in Southeast Asia is Thailand. Although merely “emerging” again since the Asian Financial Crisis of 1997 (read also the article Asian economies “emerging” for decades), Thailand, along with Malaysia, has a far more “mature” economy than that of its Southeast Asian neighbours, Vietnam, Indonesia and the Philippines and, for that matter, China. Although countries like China, Vietnam and Indonesia may register higher economic growth, Thailand’s economic fundamentals are much more solid and comparable with those of a truly developed nation.
With a population of around 67 million people, with one-third living in the urban areas, Thailand offers an interesting marketplace. The capital city of Bangkok, but even moreso the country's secondary cities, such as Chonburi, Hat Yai, Khon Kean, Nakhon Ratchasima and Udon Thani, and smaller tertiary cities, boast thriving business communities and a vast consumer base.
Other characteristics of a "mature" economy" include a modern infrastructure and well-functioning government institutions with transparent and efficient procedures and regulations. In this respect, Thailand is again far ahead on ASEAN fellow members, Vietnam, Indonesia and the Philippines.
Thai middle-class
Although in the West, businessmen get excited about a so-called “upcoming middle-class” in emerging economies, it would be wise to determine first how to define this middle-class. A middle-class is only realistically measured by free-disposable income and purchasing power. In, for example, Indonesia, where salaries are low and the cost of living high, there is no middle-class to speak of, with enough free-disposable income and true purchasing power. In Thailand, on the other hand, there is a large middle-income group with a substantial percentage of its income freely available for purchases. (Read also BTA Report: Middle-class living conditions of 2008).
Thai politics
Politically, Thailand may seem unstable. However, this instability has hardly any effect on the activities of the foreign business community in the country. It may be uncomfortable at the most when the airport is shut down or certain parts of the city are no-go areas. Foreigners have no part in the internal political tensions whatsoever, nor have the general business conditions. On the surface it may seem chaotic and dangerous when these riots occur, but in reality they have hardly any impact on daily life and doing business.
This article appeared earlier in e-magazine Business Trends Asia
Foreign companies in China’s services sector hardly succeed in expanding beyond servicing óther foreign companies in China, whether financial services or otherwise. Although this phenomena, whereby it proves hard to build up a local client base, is not unique to China and forms an obstacle in many other Asian countries too, in China it is more prominently the case.
Foreign retail formulas in China are struggling with an increasing number of local competitors, unpredictable quality and pricing demands and changing labour laws.
In the last few years, foreign direct investment (FDI) in Southeast Asia (up 16% versus 2010) is outgrowing FDI growth (8%) into China. In 2011, China received US$124 billion of FDI, whereas Southeast Asia received US$209 billion of FDI. There’s a clear trend of foreign investors shifting their focus away from China to other markets in South and Southeast Asia.
Thailand’s “mature” economy
One of the most “mature” markets in Southeast Asia is Thailand. Although merely “emerging” again since the Asian Financial Crisis of 1997 (read also the article Asian economies “emerging” for decades), Thailand, along with Malaysia, has a far more “mature” economy than that of its Southeast Asian neighbours, Vietnam, Indonesia and the Philippines and, for that matter, China. Although countries like China, Vietnam and Indonesia may register higher economic growth, Thailand’s economic fundamentals are much more solid and comparable with those of a truly developed nation.
With a population of around 67 million people, with one-third living in the urban areas, Thailand offers an interesting marketplace. The capital city of Bangkok, but even moreso the country's secondary cities, such as Chonburi, Hat Yai, Khon Kean, Nakhon Ratchasima and Udon Thani, and smaller tertiary cities, boast thriving business communities and a vast consumer base.
Other characteristics of a "mature" economy" include a modern infrastructure and well-functioning government institutions with transparent and efficient procedures and regulations. In this respect, Thailand is again far ahead on ASEAN fellow members, Vietnam, Indonesia and the Philippines.
Thai middle-class
Although in the West, businessmen get excited about a so-called “upcoming middle-class” in emerging economies, it would be wise to determine first how to define this middle-class. A middle-class is only realistically measured by free-disposable income and purchasing power. In, for example, Indonesia, where salaries are low and the cost of living high, there is no middle-class to speak of, with enough free-disposable income and true purchasing power. In Thailand, on the other hand, there is a large middle-income group with a substantial percentage of its income freely available for purchases. (Read also BTA Report: Middle-class living conditions of 2008).
Thai politics
Politically, Thailand may seem unstable. However, this instability has hardly any effect on the activities of the foreign business community in the country. It may be uncomfortable at the most when the airport is shut down or certain parts of the city are no-go areas. Foreigners have no part in the internal political tensions whatsoever, nor have the general business conditions. On the surface it may seem chaotic and dangerous when these riots occur, but in reality they have hardly any impact on daily life and doing business.
This article appeared earlier in e-magazine Business Trends Asia
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