Global market players are always looking for the next big thing , and one region currently standing out in this respect is South East Asia - namely the ten countries of the ASEAN bloc.
One reason why I think they’re looking this way is because ASEAN is the world’s third largest market, with a population of over 600 million. The region’s demographic is young and has a booming middle class with increasing wealth, affluence and aspiration. This has created a surge in the demand for quality financial services products, particularly in the banking and insurance sectors, together with the professionals to deliver them. On this latter point, it’s pleasing to note that UK-led qualifications such as those from the Association of Chartered Certified Accountants (ACCA) and Institute of Chartered Accountants in England and Wales (ICAEW) are seeing tremendous interest from our region’s markets.
This is where UK strengths prevail. Firstly, the UK has a rich background in the financial services sector, with well-known British banks including Barclays, Lloyds and Coutts. The UK’s strong legal profession is highly regarded – with over 40 established firms already plying their trade in Singapore and beyond. London is the world’s leading insurance market, through Lloyds, and this is definitely one credential which UKTI is promoting as the ASEAN Economic Community draws closer.
With the banking sector so well established, I’ll be particularly highlighting opportunities in the insurance and legal sectors.
Insurance
So what is UKTI looking to do and why the insurance sector?
Firstly let’s focus on the why and then I’ll move on to the what. To start, the insurance industry in South East Asia is experiencing incredible growth with Thailand having the fastest non-life premium growth in the region at 17.2%, followed by the Philippines at 12.8%, Indonesia at 7.7% and Malaysia at 2.7%.
Indonesia, with a population of almost 250 million, has low insurance penetration (2.1%). Additionally, some countries in ASEAN are at high risk from natural catastrophes and are woefully unprotected from them, with uninsured losses costing governments heavily. Just take the 2004 Boxing Day tsunami which, according to official reports, cost around USD $9.9 billion in economic, infrastructural and human development losses.
This is why we are looking to deliver a link-up between UKTI, the Monetary Authority of Singapore, and Lloyds of London to help promote a regional insurance coverage to help reduce the risk to millions of people from losses suffered as a result of natural disasters. This initiative will leverage on Lloyds expertise in the insurance industry, along with the Monetary Authority of Singapore’s strong regional links to help benefit ASEAN as a whole.
Legal
With the formation of the ASEAN Economic Community (AEC) coming later this year, law firms are now looking beyond geographical boundaries and capitalising on regional developments instead. Several of the ASEAN’s legal jurisdictions have English law at their core – of the 40 plus British firms registered in Singapore many are extending their reach beyond the shores of Singapore through alliances with local law firms to help provide a one stop shop for all legal services within the region.
This will be exceptionally useful for British companies coming in to the region as they can utilise these one-stop shops to move quicker, and rely on the reputation and reliability of the UK firms to help business along.
Singapore is positioning itself as the regional centre of choice for dispute resolution with the Singapore International Arbitration Centre seeing brisk business and the opening of the Singapore International Commercial Court earlier this year. Thus, with a good number of UK law firms in the region, coupled with the launch of the AEC – I believe we will definitely see significant growth in the region, within the legal sector in the next couple of years.
These are just a few thoughts, you can definitely see that now is a great time to be in the ASEAN region and especially so if you are a British company in the financial and professional services sector because opportunities are very real. You never know, a decade from now ASEAN might just be the China that you see today and missed the first time round!
For further information about doing business in ASEAN, or if you like to just chat about opportunities in in the region, do drop me an email at UKTI.ASEAN@fco.gov.uk