HSBC sees huge potential for Asean to hold strategic positions alongside China’s Belt and Road and help the region to take advantage of opportunities arising from the emergence of digital breakthroughs and transportation infrastructure trends.
Marking its 50th anniversary this year, Asean has pledged to double infrastructure investment to more than $700 billion (Bt 23.3 trillion) over a five-year span.
One of the most ambitious projects will be a high-speed rail network linking South China to Laos, Thailand, Malaysia and Singapore.
Kelvin Tan, chief executive officer, HSBC Thailand, said yesterday that in order to fund such a project, Asean governments needed to source private funds via a public-private partnership (PPP) scheme and the challenge would be how the parties share the risks. He said HSBC could advise on best practices of risk sharing for the benefit of both sides.
Rohit Joshi, HSBC’s head of global liquidity and cash management for Singapore, said that when the bank recently held an investment road show in the United States, investors were very excited about the fast-growing Asean region.
He said that digital transformation was another emerging trend in the region. Asean is the fourth largest internet market in the world and its size was expected to rise six-fold, to approximately $200 billion, by 2025. The number of Internet users was also expected to soar from 260 million to 480 million by 2020.
“As the region moves towards a cashless society, there is a major push for demonetisation and an increased need for digital payments,” said Rohit. “We have seen early adopters in Singapore (FAST), Thailand (PromptPay) and Malaysia (JomPay) upgrading their payments infrastructure to enable immediate settlement.”
He was upbeat that cross-border Asean payments with immediate settlement were a real possibility in the near future.
Kobsak Chutikul, secretary general of the Asian Peace and Reconciliation Council, said that much of the risk for the region related to uncertainty over future actions by US President Donald Trump.
This reflected concern both over his policies and his anti-globalisation sentiment that could lead to trade protectionism and could hurt an Asean economy largely dependant on exports.
“Nowadays, when I get up every morning the first thing I look at is Twitter to see what President Trump has tweeted,” said Kobsak, who admitted to being worried about Trump’s “America First” policy.
Asean today has grown into an economic powerhouse. With a combined GDP of $2.4 trillion in 2015, if it were a nation, Asean would be the seventh-largest economy in the world and could be the world’s fourth largest by 2050, he added.
Published : May 24, 2022
Published : August 23, 2017
By : WICHIT CHAITRONG THE NATION