A new report from a global law firm has analysed the modern business landscape in Asia.
Herbert Smith Freehills issued the Redefining Asian Business report earlier this month.
Seventeen years into the ‘Asian century’, countries such as China, India and Indonesia are experiencing rapid economic growth and a burgeoning middle class. PwC has estimated that India will become the second-biggest economy in the world by 2050, while Indonesia will be the fourth-biggest.
Herbert Smith Freehills Asia managing partner Justin D’Agostino (pictured) said the report will help clients understand business opportunities in Asia.
“Our lawyers are frequently asked to explain the differences between Asian businesses and their European and American peers,” he said.
“The report captures these critical differences and provides a guide to the region’s business growth and opportunities, written from an Asia insider’s perspective.”
The report analysed history, culture and strategy to separate Asian businesses into four ‘super-blocs’: the old guard, state standards, young innovators and asset hunters.
Old guard companies, which have built up their revenue and brand value over generations, are facing growing competition from ambitious rivals. Many are at a point where they need to rethink their business models and embrace digital disruption and internationalisation, the report said.
State standards are the state-owned enterprises (SOEs) experiencing strong growth in sectors such as energy and resources, banking, construction, logistics, telecommunications and many others. China is leading the charge when it comes to SOE growth, while investigations are forcing them to improve their efficiency.
Young innovators are the emerging tech firms capitalising on the growing Asian middle class. Many of these consumer-focused young companies are going from strength to strength, with data as their most valuable asset, but could face challenges in terms of privacy and cyber security.
Asset hunters include sovereign wealth funds, private consortiums and conglomerates. Many are banding together to compete for assets on the international stage, and Chinese buyers in particular are becoming more discerning, HSF said.
Mr D’Agostino said the report would provide valuable insights into Asian business.
“Understanding each bloc’s culture, aspirations and issues will guide those working with and for these companies as their influence spreads even farther around the world,” he said.
“Individual companies may rise and fall, but the huge, diverse mass of Asian business is not going to retreat and provides massive opportunities for those that understand it well.”
Pictured: Justin D'Agostino