Almost 7 in 10 APAC CEOs eye boosting investment in the APEC region

Hong Kong and Singapore are highly targeted.

Confidence among CEOs in Asia Pacific continues to get stronger, based on the results of a new report.

According to a release from PwC, forty-six percent of executives in the region now say they are “very confident” of growth in the next 12 months, up 10 points from 2012 and four points from last year, 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 was recently released during a meeting 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. Their plans are spread over each of the 21 APEC member economies, with China, the US, Indonesia, Hong Kong-China and Singapore the most popular destinations for investment.

Capital spending is a part of it; 57% of respondents said they are either building or expanding facilities in APEC economies in the next 3 to 5 years. Not surprisingly, China is the top pick where most of the spending will be.

“There’s no doubt that China is slowing down. But that doesn't mean that it has lost, or losing its lustre, among business leaders. It is still the second largest economy in the world and its GDP growth is still the envy of many economies.

In fact, our survey respondents who already have a presence in China are more confident in the Chinese market for their products and services than they are about the international market. Furthermore, foreign investors are optimistic about adjustments to China’s economic structure,” says David Wu, Government and Regulatory Affairs Leader, PwC China. “That in itself is a stamp of confidence.

Here's more from PwC:

Most of those asked in the survey also plan to hire: 38% of respondents expect headcount in their organisations globally to expand by at least 5% a year over the next 3-5 years.

Supporting this confidence is a vision of an Asia Pacific region that is more connected, both physically and virtually, and an outlook for more balanced regional growth.

For example, 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.
“Asia Pacific today stands at a turning point as advancing technologies move beyond national boundaries and create new demands and even new industries,” says Dennis M. Nally, Chairman of PricewaterhouseCoopers International Ltd.

“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.”

The survey found that data-driven changes are having an impact in the region; 57% of executives say they are more confident of their ability 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.