Southeast Asia - Post Pandemic Shifting Paradigms 2023 Blog
The Positioning of Southeast Asia in a Post Pandemic and Regionalizing World
The worldwide pandemic of 2020 accelerated and created new risk issues in the global structure of trade and the positioning of corporate supply chains within this structure. The fragility of just-in-time supply chain processes was exposed, creating critical strategic and financial distress to the world economy and corporations of every size, regardless of geographic reach. The Southeast Asia region – defined in this study as the countries within the Association of Southeast Asian Nations (ASEAN) – achieved significant investment as a player in the flat world globalization efforts starting in the 1980s and leading up to the pandemic. Will this significant investment continue post pandemic, and should regional/global companies view the region as a secure and viable link in their supply chains going forward?
This paper will present a high-level SWOT and site selection analysis of the ASEAN’s positioning in the restructuring of the post pandemic global supply chain. The events of the current post pandemic world will result in an acceleration of interest and investment - the predominant viewpoint is that of a business site selection process, whereby companies are reviewing alternative macro and micro locations for investments in “where-make” and “where-buy” decisions. It will examine and provide the analytics to show that multinational companies will and should continue to view the region as a beneficial investment opportunity based on demographics, labor structures, availability of resources, development of global cities, formation/ strengthening of regional and global partnerships, the continued attraction of foreign direct capital investment, transportation security, governmental incentives, and improvements in business compliance issues (democracy, transparency). A comparative site selection model will be presented to show the diversity of variations between ASEAN countries, revealing strengths and areas of opportunities for improvement.
Figure 1: SWOT Analysis
Figure 2: The ASEAN organization
Key Takeaways
ASEAN’s appeal as an alternative service, financial, and manufacturing base will continue to grow, and may accelerate due to recent pandemic supply chain issues and post pandemic geopolitical issues.
A site selection matrix shows that the region’s economic, demographic, labor, investment, and business conditions are attractive to global and regional companies desiring to diversify supply chains and seek access to Asian and Western markets.
The region contains world-class cities, becoming increasingly important as business destinations.
New trade agreements could alter the structure of regional FDI and reposition the flow of global trade.
ASEAN nations offer attractive incentives programs for business investment.
The region has significant problems to overcome, but new initiatives, investments, and improving business compliance conditions are progressing.
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