04 Strategies to seize opportunities from the rising CLMV
Currently, tremendous attention have been paid to the CLMV from global investors due to various factors such as abundant natural resources, plenty of low-cost labor, open trade policy, and the central location in the heart of ASEAN. As the competition in the global market intensifies due to slow global demand and a weak domestic economy, in order from the businesses to improve their competitiveness to gain from the opportunity in CLMV, EIC proposes 4 strategies 1) cost reduction, 2) value-added, 3) market seeking, and 4) opportunity seeking in related-business. However, the businesses should bring along their existing expertise to be able to compete with potential competitors from other countries. Besides, having a decent local business partner is another ingredient to smoothen the local business operation.
The dawn of the ASEAN Economic Community (AEC) in 2015 marks a new step toward ASEAN becoming an important market place especially, the CLMV region (Cambodia, Laos, Myanmar, and Vietnam) due to many reasons such as high levels of economic growth with plenty of young and low-cost labor as well as abundant natural resources. Their governments are also opening up the countries to free trade, establishing service centers for businesses, and providing various investment incentives. Moreover, the CLMV region is conveniently located in the heart of ASEAN, a connecting point for many big trade routes around the world. Additionally, CLMV countries have been investing heavily to develop and improve their infrastructure with support from richer counterparts like Japan, China, the U.S., and Germany. These factors make the CLMV a great option as a new production base and a potential region to expand their market.
Pitsinee Thitisomboon - Economic Intelligence Center SCB