The ASEAN region - has emerged as a major player on the global investment scene, with rapid rises in both inward and outward investment over the past decade.
With its large, young population ASEAN has taken on China’s former role as “Asia’s factory” – and with that has come a tremendous surge of investment into the region.
ASEAN now attracts more foreign direct investment (FDI) than China, as businesses hurry to secure their own slice of this rapidly growing opportunity. ASEAN’s £1 trillion of FDI stock is the world’s third largest, behind only the US and the UK.
British brands like JCB, Unilever, Tesco, BT, Rolls-Royce and HSBC are all long-established in ASEAN, and a constant flow of British businesses is adding to this number every day.
British businesses are already helping the economies of ASEAN to grow; from construction machines and consulting engineers, law firms and fintech companies, retail stores and manufacturers, and everything in between, the UK is already a major part of ASEAN.
UKTI continues to work with thousands of companies as they take their first steps into this dynamic and welcoming region; and supports them as they grow, succeed and expand.
It’s not all one-way traffic however; ASEAN also invests more globally than mainland China, with the total outward investment stock quadrupling over the past decade to a record £462 billion, a greater amount than that of any of the BRIC countries.
ASEAN outward investment is currently dominated by Singapore, Malaysia and Thailand, with their major financial hubs, huge investment funds and multinational conglomerates, but investment from countries such as Vietnam and Indonesia is already growing rapidly: Vietnam was the fastest growing exporter to the UK from 1993-2013; and Indonesia, a stirring giant of 250 million people, already has the world’s 16th largest GDP and is on course to bag the number seven spot by 2030.
The numbers and the trends are impressive – perhaps surprisingly so – but what does this mean for the UK?
ASEAN is Asia’s ‘third pillar’, and with China and India, will drive British – and global - economic growth for years to come.
Happily, the UK is already a popular destination for ASEAN investment, with three times more investment in the UK than in Germany and the US combined. In fact, the UK accounts for half of all investment from ASEAN into Europe, with the figure growing 150% from 2008-2013 to £28 billion, and continuing to grow.
The work of UKTI has already helped to secure record levels of investment into the UK, with notable recent investments including the redevelopment of Battersea Power Station – with an estimated development value of £5 billion – and major investments for Tune Hotels, Caterham, Lotus, Laura Ashley, and more than £4 billion from just one of Singapore’s sovereign wealth funds put into oil and gas, transport and entertainment projects.
ASEAN investments in the UK range from prestigious property developments and high street fashion, to renewable ‘energy from waste’ power stations in Middlesborough and Runcorn, to the world’s largest and most powerful tidal power turbine in Orkney, Scotland.
Despite record investments into the UK, there is potential for significant growth in investment from ASEAN and the visit of Prime Minister David Cameron provided the perfect opportunity to strengthen the UK’s relationship with ASEAN, and ensure that the UK continues to attract even more investment for its growing infrastructure, regeneration projects, energy needs, and in key UK industries.
As the rest of the world increase their efforts to court ASEAN investors, the UK is already leading the field, talking to ASEAN businesses and investment funds, and building links at the highest levels.
As ASEAN continues to grow impressively, our strong relationships will ensure that the UK remains perfectly placed to attract investment from ASEAN, bringing jobs and growth, and building our mutual prosperity.
For more information and support on investment opportunities in South East Asia contact UKTI.ASEAN@fco.gov.uk