Why ASEAN?

Located at the center of the Asia-Pacific region, the ten nations of ASEAN cover more than 1.7 million square miles and boast a diverse population of 626 million, approximately 10% of the world’s population. The economy has grown over 300% since 2001, and in 2013 was valued at $2.4 trillion. This makes it the seventh-largest economy in the world, behind the United States, China, Japan, Germany, France, and the United Kingdom. One of the fastest growing economies in Asia, ASEAN has exceeded average global growth over the past ten years. By 2050, it is expected to become the fourth largest economy in the world.

ASEAN has the third-largest labor force in the world, and a youthful population means it is continually growing. In addition, productivity improvements are driving economic growth. Nearly 60% of ASEAN’s growth since 1990 has come from productivity gains in sectors such as manufacturing, retail, telecommunications, and transportation.


Think Regionally

ASEAN is moving toward economic integration, with the goal of creating an ASEAN Economic Community (AEC) by the end of 2015. The AEC will build on the existing ASEAN Free Trade Area (AFTA) to establish a single market and production base that allows for the free movement of goods, services, and skilled labor. It will also allow for a more open flow of capital and investment. In addition to promoting integration among ASEAN nations, the Association has forged free-trade agreements with regional partners such as Australia, China, India, Japan, New Zealand, and South Korea.

67 million households in ASEAN states have joined what McKinsey calls the “consuming class,” with incomes high enough to cover basic consumption and a growing appetite for luxury goods. This number is forecasted to grow to 125 million households by 2025, making ASEAN an important consumer market today and in the future. The market is diverse, but consumers are trending toward more leisure activities, a preference for modern retail formats, and increasing brand awareness and loyalty. In recent years, ASEAN has also seen improvements in digital adoption. E-commerce has seen dramatic gains in the region, specifically in Singapore, Malaysia, Indonesia, and the Philippines, with Singapore and Malaysia accounting for 50% of total online sales for ASEAN.

The U.S. Commercial Service in ASEAN exists to help U.S. companies take advantage of opportunities in this important market. Contact us today to speak with one of our consultants about developing and executing a customized market entry strategy.


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