AEC buzz: Snippets of news from Asia News Network

A girl preparing car fragrance and freshener for display at Myanmar's international automotive parts, accessories and servicing expo 'MYANAUTO 2015' exhibition in Yangon, Myanmar, on Oct 09, 2015.
A girl preparing car fragrance and freshener for display at Myanmar's international automotive parts, accessories and servicing expo 'MYANAUTO 2015' exhibition in Yangon, Myanmar, on Oct 09, 2015.PHOTO: EPA

Thailand as gateway to Cambodia, Laos, Myanmar and Vietnam
 

“With the AEC, Thailand can be a logistics hub for many food and fashion brands from the Philippines and other countries that want to penetrate Asean, especially the CLMV market. They can set up a regional office in Thailand to do marketing and the sorting of products,” said Mr Samie Lim, chairman emeritus of the Philippine Retailers Association.

There are currently about 25 local food brands and another 25 fashion brands from the Philippines looking to expand their presence to Thailand and other potential markets in Asean via franchising, he said.

“On the other hand, the Philippines can be a gateway to the West. We can help our Thai franchisees to go beyond Asean to Europe or the US. We have strong marketing and networks. We have also very good ideas in creating business and innovation,” Lim explained.

The Nation/Asia News Network
Publication Date: 26-09-2015
 

Asean as the next world's factory
 

Mr Glenn Maguire, chief economist with ANZ Bank for South Asia, Asean and Pacific,  sees Asean as a manufacturing hub becoming just as important as China.  “Workers are not only growing older in North Asia, they are becoming more expensive,” he said in a commentary earlier this year.

Mr Maguire added that the migration of manufacturing platforms south into the “youthful and cheaper Southeast Asian economies seems all but inevitable”. “More importantly, the commencement of the Asean Economic Community from December (2015) will be an important multilateral enabler of the drift of factories in Asia to the south.”

Ms Sandra Seno-Alday, a lecturer at the University of Sydney Business School and the Sydney Southeast Asia Centre, said one of the key factors that have contributed to the rise of Aseab as a manufacturing hub is wages. China has priced itself out of many sectors a long time ago, she added.

“The natural move, especially for low-end, labour-intensive manufacturing, has been to countries like Vietnam, Cambodia, Thailand and Indonesia, where wages are a lot lower,” she told China Daily Asia Weekly.

According to management consulting firm McKinsey Global Institute,  the average cost of factory labour is about US$7 a day in Vietnam and US$9 in Indonesia — far lower than the US$28 average in China, “which has posted a 19 per cent compound annual growth rate in labour costs since 2007”.

China Daily/Asia News Network
Publication Date : 26-09-2015