North Asia Seen as Having Significantly More Potential than South or Southeast Asia

With a large amount of deviation, respondents rated China as the economy with the most potential in Asia. Japan, Korea and Taiwan also rated high, India appeared underrated and many did not know where ASEAN was located.

When asked to rate various Asian economies according to their ability to enhance their business, respondents rated "China" (6.74) higher than all other options. In fact 26% of respondents who answered this question accorded China a 10 – the maximum response. Perhaps due to this enthusiasm, however, the deviation of responses concerning China at 3.19 was notably higher than all others – with India at 2.84 having the next highest diversity of responses. Following China, the next highest rated economy was "Japan" (6.28), followed by "Korea" (6.20), "Taiwan" (6.14), "Hong Kong" (5.67), "India" (5.54), and "ASEAN" (5.33).

Based on this data as well as follow-up discussion, it would appear the high positive sentiment accorded China due to its ability to deliver high growth potential does not adequately incorporate recognition of potential risk factors. For example, one Sales Representative for a Major Component Manufacturer commented on only one of many possibilities stating, "When I see the trends of the products my company is selling, North America is a tiny percent of the purchase orders. Japan has stopped growing and Korea is now a larger market than Japan, the US or Europe. And growth in China is like a hockey stick. Many customers are also shutting down assembly plants in Singapore and Malaysia and moving to China. This is all for cost reasons. There is a risk, however, of over-reliance on China. How much can you rely on their government? Over time they will have to join global community, but in the short to mid-term, it is particularly risky to do business in an unstable environment with an overzealous government."

Japan, Korea and Taiwan were also highly rated. India, however, appeared underrated, though one CEO for an Instrumentation Company who had just begun to look at the country stated, "India is phenomenal. I am talking to people there right now. They are growing rapidly and it is the new frontier. In what we do higher level math is important and the people that do the development work need to know that. In China you can find the knowledge but they generally do not have the experience to apply it to tangible development. In India, however, they are a whiz. They are excellent and creative and have a talent to apply the abstract to concrete production."

Additionally, despite the fact it encompasses 500+ million people, a significant number of respondents were not familiar with the designation ASEAN. This can be seen in the fact while all the other economies specified attracted approximately 150 responses, only 134 rated ASEAN. One respondent, for example, the President of a Semiconductor Design Firm asked, "Where the heck is 'ASEAN'? Do you mean 'Asian'?"

A Technology Sales Manager explained the reasoning behind his ratings noting "Our technology is very advanced therefore tends to hit Japan and Korea first, then Taiwan, lastly China. Some design, but not decision-making resides in India."

A Medical Equipment Manufacturer also noted the importance of differentiating between different markets, stating "Advanced intellectual countries will probably become customers faster for us. They will adopt this technology faster. Taking a pill is not related to the degree of progress. This technology is unconventional and the culture needs to be ready to make believers in it. For that reason Japan and Europe will probably be a better market than China for us."

Respondents' quotes

"We lost a large amount of funds in China."

"Singapore is very important to managing activities in ASEAN area. Probably, Vietnam will be a key country in the next 3 to 5 years."

"Where the heck is 'ASEAN'? Do you mean 'Asian'?"

"I see the Gulf States becoming more and more important as international oil consumption will continue to increase over the next 20 years. This is why I am learning Arabic."

"Our technology is very advanced. Therefore it tends to hit Japan and Korea first, then Taiwan, lastly China. Some design, but not decision-making resides in India."

"I need to understand IP rules and enforcement. I need to understand how to get my people there and back without hassle."

"Japan is too hard to penetrate as a market."