Asia-Pacific CEOs upbeat on economic integration

Malaysia seen as a 'fast-growing APEC economy' and a priority investment destination

The Malaysian Reserve, 6 September 2012; Corporate Malaysia; pg 7

CHIEF executive officers (CEOs) headquartered in the faster growing Asia-Pacific Economic Cooperation (APEC) countries are upbeat about Malaysia as an investment destination.

They see Malaysia as one of the fast-growing APEC economies and are prioritising in-vestments in the country, placing most emphasis on access to local talent and domestic customers.

While only 36% of CEOs surveyed by PriceWaterhouseCoopers (PwC) are "very confident" of business growth over the next 12 months, citing economic disruption, including a possible recession in the US, the eurozone crisis and a slowdown in China's growth as the reasons, 54% of them are optimistic that the region is on track to achieve greater economic integration within the next five years.

"To meet the challenges and opportunities ahead for this region, they will have to extend their presence beyond their home markets, innovate their products and processes, and develop the right talent for future business opportunities." said PwC Malaysia managing partner Sridharan Nair.

Top priorities are placed in obtaining talented and highly skilled workers with 40% of CEOs planning to expand their workforce by at least 5% in the next three to five years. Nonetheless, 42% expect talent shortages in the region to worsen within the same time period.

Recognising that more incentives are critical in attracting and retaining talent, the CEOs are calling for APEC to work on skills mapping in the region while easing restrictions on immigration to enhance the mobility of knowledge workers.

Regarding regulation and investment policies, nearly half of the CEOs said that removing trade barriers in services is a key to greater integration within the 21 APEC members, identifying China and the US as their dominant targets for investment over the next three to five years.

In order to fuel deeper integration, the CEOs are asking APEC's political leaders to be more transparent in communicating international investment policies and to allow businesses access to timely, reliable data on economic developments.

"CEOs need to work closely. with policymakers to harmonise regulations and remove trade bottlenecks across the diverse economies of this region," Sridharan added.

The CEOs also said that the top economic risks to growth were a spike in oil prices above US$150 (RM467.90) per barrel, a US recession, a breakup of the eurozone, and a slowdown in China's growth to below 7.5% of gross domestic product.

Other important findings of the survey include the need for policies that address negative impact of energy and water use where 74% would welcome such policies while nearly 60% are adopting water conservation techniques and 27% are exploring renewable energy solutions to generate their own power in the next three to five years.

Almost 60% of the CEOs said that there is a "critical" need to improve their use of technologies like cloud computing, digital devices and social media in order to meet customer and employee expectations.

The APEC CEO Survey 2012 was conducted by PwC International Survey Unit between June and August 2012, covering 376 CEOs and industry leaders in 40 economies, including all 21 APEC economies.

The APEC CEO Summit which will held in Vladivostok, Russia, from Sept 7-8 is Asia Pacific's premier business event, drawing thousands of economic and business leaders from around the region and beyond.