Japan Rebooted

ASEAN, the next frontier: Tapping Southeast Asia’s surging growth

Japan Rebooted

In this ASEAN issue of the Japan Rebooted series, we explore a large emerging region that is on Japan’s doorstep and must be seen as a major consumer market rather than just an alternative manufacturing base to China.

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While Japan has traditionally looked to far-flung middle class markets for growth, the key to its economic future lies in growing engagement with the countries on its doorstep.

Japan Rebooted: ASEAN the next frontier highlights the opportunities in the markets on Japan’s doorstep, particularly for consumer products, clothing, food, financial services, education, and health care. It also cites infrastructure as a key area of opportunity for Japan.

While Abenomics has successfully made Japanese goods and services more attractive to overseas buyers, it is now up to Japanese companies to uphold their end of the bargain by implementing reforms to truly internationalise and establish new markets in the region.

The report says Japanese firms looking to enter ASEAN markets would be best served by acquiring local entities, because organic growth is often too costly and time consuming. It also highlights the urgency for Japanese firms as competitors from the EU and US consolidate their foothold in the region.

Key statistics in our report include:

  • Asia’s share of the global middle class population is expected to grow from an estimated 30 percent to 50 percent or more by the end of the decade
  • By 2015 the size of the middle class in Asia Pacific will overtake that of Europe and North America combined
  • Total consumer spending is ASEAN countries is set to reach $2 trillion by 2020, representing real growth of 45.7 percent over the 2013-20 period
  • Spending on communication, education, and hospitality in ASEAN countries is forecast to grow by 62 percent, 59 percent and 51 percent respectively.