Archive for April, 2016

SE Asia: Investing In or Out?

April 18th, 2016

asiaSouth East Asia has lately been the recipient of some quite attractive investments. For example, according to stats from Tech in Asia, startups in the region – in the first quarter of 2016 – received $478.4 million, 100% more than for the same frame, year-on-year.

These figures are interesting and inspirational given that since 2013, economic prosperity around the world has not even managed to completely negate its way past the 2008 fiscal crisis. Yes it’s true the fiscal situation in China has been encountering a stagnation with markets there enduring increased volatility.  But still, compared with the monetary situation around the rest of the world, investors are choosing Southeast Asia due to its solid fundamentals such as a 600million plus population and a $2.3 trillion GDP – the seventh largest in the world with a projected growth spurt of rising to number four.

Google wants to be in Asia too, as part of its wider vision of renewable energy. But the multi-million dollar corporation is having a hard time as purchasing energy there is fraught with difficulties.  Ascertaining the right credentials is next to impossible. Trouble is, it’s hard to buy green energy there. The system for getting proper credentials for renewable energy sources is virtually nonexistent on the continent.

In addition, vis-à-vis emerging market funds, Asia is not looking so great right now. Substantial amounts have been pulled from these funds, and most of them, from the Asia region.  Indeed, according to a recent article by Teresa Rivas in Barrons, based on findings from analyst Markus Rosgen, “Most of the outflow from EM funds came from Asia, which saw investors withdraw $970 million.”

So there are different ways to look at what is going on in Asia.  It’s definitely not a black and white situation.  The hope is though that the good will outweigh the bad.