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FIELD TRIP TO ASIA: 1991-2011, from the end of colonial Asia to the birth of modern Asia

Marina Bay Sands, Singapore

22 November 2011 (Manila, Singapore, Hong Kong)

Twenty years is a short blip in the history of Asia.  Yet this span of two decades marks an important moment of resurgence for the region.   In 1991, multinationals and their expats ruled the rooster.   Most of the countries were still entangled in the model of import substitution, current account crisis and shaky currencies.  Old colonial buildings were still the main architectural attractions in most capital cities.  Today, the crowd of expats has seriously thinned on the ground, pushed out by high costs of living and talented local managers.   Cutting edge buildings, such as the Bay Sands complex in Singapore, are now commissioned more often in Asia than anywhere else.  Modern Asia is coming into its age.

During the period of 1991 to 1995 I was fortunate to visit more than twenty Asian countries, from Pakistan and India, to Japan and China, to New Zealand and Australia.  At the time Japan was grappling with its own terrible financial bubble and crisis.  The young economic tigers (Hong Kong, Singapore, South Korea, and Taiwan) were the living proof that the export development model was the way forward for others:  A mix of low costs, hard discipline, national dedication, disguised protectionism and export drives.  Soon the rest of Asia followed suit, dumped import substitution, opened up and built export industries in electronics, garments, industrial goods and IT services. 

1997 saw the transfer of Hong Kong to China, a last closing point in the colonial history of the region.  Then Thailand became the epicentre of the notorious economic crisis that affected emerging countries across the world.   Caught short with insufficient currency reserves, Asian countries responded to the crisis by accelerating economic and financial reforms anchoring their export model.   The hard lessons of 1997 are serving Asia well in this current financial turbulence.  China joined the WTO in 2001, and hence after demonstrated that the famous ‘hockey stick’ projections could actually occur for once in real life.  The tide was by then turning in Asia.

By 2005 it was becoming increasingly clear the Asia region had all in the elements in place to rival the European Union and the Americas in trade and competitiveness:  a vast pool of cheap labour, technology creation and sophisticated manufacturing capabilities in the advanced countries, a growing middle class peppered across the region serving as a large Asian domestic market for scale up, and local financial centers that could oil the wheels of trade and commerce in the region.  Multinationals sped up their investments in off shore production, R&D and marketing and soon FDI was pouring in the region, notably in China.  Thousands of cranes have in the past decade built modern infrastructures, from airports, to highways and port facilities.  Investments into infrastructures and real estate have been a big part of the economic story.  Modern skyscrapers have nothing to envy to North America.


Today a new modern Asia is taking shape and the economic challenge to western economies will not abate soon.   There are now more than a dozen countries challenging the West on the road to higher value goods, hungry for market shares.  Asian economies have built critical masses and their growth story benefits from positive reinforcements:

–          Rather sound economic policies are now focused on developing high value exports or protecting value chains, increasing productivity, keeping competitive exchange rates, and building up reserves.  This stability reassures foreign investors targeting low cost export production or marketing for the domestic consumers.

–          More investments and jobs lead to growing middle class markets, which in turn attract more local and foreign investments.

–          The new middle class is young and tech savvy. For instance, call centers in the Philippines employ more than 600,000 young workers, most with graduate degrees. Their impact in Makati is clear in the cafes and shopping centers.

–          Managerial talent: In Hong Kong, new CEOs of multinational affiliates are increasingly Chinese.  Years of training and talent development are now bearing fruits.  The expat crowd is now mostly found in financial centers or in offices playing a regional coordination role.  These regional centers, traditionally located in Singapore or Hong Kong, are now even shifting activities to inland China.

–          Emerging champions: Out of vast markets is emerging a new breed of champions, testing international waters in other emerging markets.  The shelves of local bookstores include titles like The globalisation of Chinese companies, Strategies for conquering international markets, Chinnovation, How China’s leaders think, Start-up Asia, etc.

–          Technology agenda:  Asian firms have been adept at technology transfers, by all possible means. But the best of Asia are building their own technology.  Samsung is the one rival barking at the heels of Apple.   R&D spending is shooting up in Asia.

–          Innovation:  New markets call for new innovation patterns, with an emphasis on high value/cost ratios (frugal innovation). Expect to see some those innovations to cross oceans.

–          Financial centers:  Banking systems differ in Asia, bearing a different mix of private and state banks than in the West.  There is no doubt that Singapore, Hong Kong, Shanghai and Tokyo form a powerful cluster in finance.  We should expect to see the rise of the Yuan as a weighty international currency within 5 to 10 years.


As much as Asia is luring a column of businessmen, it is still a high risk deal making area, where the rule of man overshadows the rule of law.  The landscape is littered with broken dreams, broken promises and broken bank accounts.  This is not a place for amateurs.  Increasingly doing business in Asia calls on the strength of brands, minimum company size, market knowledge, and long term commitment.  Successful partnering requires astute diligence work, and cultural fluency.

There was a time when rules were written by Westerners in Asia.  Now Asians have written their own and we have to learn to play by them.  This is the engine of growth for many international companies, as a great deal of them are expanding at a rate of more than 20% per annum in the region.  Despite the predictable bumps, this is also the promise of modern Asia.

André Du Sault

ADS has visited, worked or travelled in Asia since 1985. Teaches ‘Doing business in Asia’ at McGill University.

Posted in Country visits, Management ideas, World economy.

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  1. Hugues Lacroix says

    Thanks for this very informative post from a versed traveller…

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