The survey was conducted by the Pricewaterhouse Coopers (PwC) that is professional in auditing and assurance, consulting and tax services. For seven years, the PwC with the role of Knowledge Partner to the APEC CEO Summit has carried the APEC CEO survey to sharpen understanding of what’s driving business growth and investment in the region.
The participating Asia-Pacific Economic Cooperation (APEC) economies are Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Taiwan, Thailand, the U.S, and Vietnam.
This year’s survey showed that dispute regional growth uncertainties, APEC business leaders’ continue to invest in businesses and in economies across the region to seed future growth.
Specially, CEOs in Vietnam are more likely to expand their business over the next year with 76 percent of respondents who expect to increase investment in 2017 compared to only 53 percent of CEOs in other APEC economies who are likely to invest across APEC. This result reflected the perspective of 54 business leaders in Vietnam compared to all 1,154 ones (APEC CEOs) surveyed from May to July 2016. Over half of all respondents are in organizations with more than 1 billion USD in annual revenue.
According to the survey, Vietnam’s central position in evolving regional trade projects further adds support to its growth prospects. CEOs in Vietnam are more likely to see significant progress toward the goal of free trade in Asia Pacific compared to CEOs in the US or Japan. The Tran-Pacific Partnership, one of Vietnam’s important free trade agreements, is widely expected to boost exports, although implementation seems less certain than it did a year ago, the survey showed.
Although the GDP growth rate of Vietnam in 2016 is estimated at 6.21 percent, the survey noted that Vietnam remains among the fastest growing in the region. The country is drawing record foreign business investment with around 15.8 billion USD in 2016. A market of over 90 million people, rapid middle-income growth and openness to foreign ownership combine to boost its attractiveness. CEOs in Vietnam are most confident in attaining higher margins from domestic operations.
For expanding plans in 2017, some 33 percent of respondents in Vietnam is more confident of launching a new product or service or entering a new line of business. Meanwhile, 41 percent of CEOs believe in increasing profits margins in domestic operations, and 19 percent are less confident about increasing profits margins in international operations. The survey also pointed out that the CEOs in Vietnam consider lower-cost skilled labor a major force driving regional economic integration.
According to CEO of Securities Corporation in Ho Chi Minh City Johan Nyvene, Vietnam will benefit from the growing integration of regional economies as Vietnam is among the top most attractive destination to CEOs in APEC bloc. The growth rate in other countries in the region had probably reached a plateau, which will require them to invest beyond their borders.
“Thus in many cases, Vietnam is not only a destination for
investors from developed countries, but also for investors from Thailand or
Indonesia” Mr.JohanNyvene said.
The survey also noted two investment trend that indicate expectations for future drivers of business growth including expanding across borders with targeted investment and expanding data touch points inside and outside the business.
On average, APEC business leaders are investing in seven other APECT economies. This is the competitive arena that matters most, reflected in the rise of global foreign direct investment in 2015. Business investment capital is pushing across borders to accelerate growth and as a result, often bumping into fresh regulatory issues.
CEOs today say they balance policy and market factors in cross-border decisions. These perspectives suggest cross-border business investment will increasingly flow to the right regulatory conditions for business expansions, according to the survey.
The survey indicates that the Internet of Things (IoT) is opening up new business models and forging new and closer relationships, with customers and supply chain partners.
The PwC’s survey concluded that over the next three years, there would be more APEC companies deploying IoT technology than those, which are not. The twin aims to facilitate free trade of data - and keeping that data secure - will likely persist as jurisdictions grapple with keeping laws, and regulations on cross-border data transfers in step with, or ahead of, IoT advancements and wider adoption of the technology.
