Confidence among CEOs in Asia Pacific continues to climb while businesses look to grow connectivity to the region by embracing new partnerships and technology, a new report by PwC finds.
Almost half (46%) of executives surveyed now say they are “very confident” of revenue growth in the next 12 months, up 10 points from 2012, despite slowing growth in China, the economic engine for the region.
PwC’s study, New Vision for Asia Pacific: Connectivity creating new platforms for growth, surveyed more than 600 business leaders about prospects for business in the region. It has been released at an economic leaders’ forum of the Asia Pacific Economic Cooperation (APEC) in Beijing.
The survey found that 67% of executives plan to increase investment in the APEC region over the next 12 months.
In a sign of growth to come, PwC has estimated that the private sector plans to spend $NZD 72 billion over the next three to five years on new capital projects in the APEC region.
Almost sixty percent (57%) of respondents plan to build or expand facilities over the next few years from manufacturing and retail to communications infrastructure and automation.
Connectivity through Technology:
Businesses in APEC economies are utilising technology in a variety of ways, but the two standouts are using data to forecast demand and using social networking to reach customers and make decisions. This includes making use of integrated systems, data from the networks and customer feedback.
While many businesses are jumping on social media, they aren’t quite sure what to do with the data yet with only 12% being ‘very confident’ that they’re profiting from their investments in social networks.
“In terms of using data to forecast demand, it’s a more positive story. Half of executives surveyed say their ability to forecast market demand for products and services is improving. Greater use of data to fortify predictive models plays a role”, says PwC NZ’s Strategy & Markets Partner, Craig Rice.
The survey found that data-driven changes are having an impact with 57% of executives saying they are more confident of their abilities to respond to changes in the marketplace, and half say they are more skilful at forecasting demand. These executives are more likely to be “very confident” of growth (67%) than their peers.
Technology also seems to be driving collaboration. Nearly 60% of executives say they are now more willing to share insights and resources with business partners in order to speed product development and gain market access. And more than 40% say their company will likely enter a business combination outside of their core industry.
While many APEC businesses may not be ready to fully participate in the digital economy, close to one billion people are believed to be active users of social networks in Asia Pacific, representing a market penetration of 25% and increasing.
“Asia Pacific today stands at a turning point as advancing technologies move beyond national boundaries and create new demands and even new industries,” says Craig Rice.
“CEOs see the need to be bold in breaking down the barriers to growth. They want to finalise the Trans-Pacific Partnership, address intellectual property issues and encourage regulatory harmony in the region.”
“Businesses are investing in a different Asia Pacific with rising numbers of urban middle-income consumers demanding new, technologically advanced products and services from business and governments. In its 25th year, APEC has an on-going and important role to play in helping to meet these demands and advancing growth throughout the region.”
