How language and culture can adversely affect decision making. You wouldn’t invest in a dud, or at least you wouldn’t think so. Yet we are seeing large scale investment into economies, some of which are projected to return a negative. And this could be simply because of the uncertainty in language and culture.
The economies that receive the largest investment by USA companies (1) United Kingdom, (2) Netherlands, (3) Luxembourg, (4) Ireland, (5) Canada, (6) Singapore, (7) Bermuda, (8) Switzerland, (9) Germany. And across Europe the total combined GDP growth estimate for 2023 stands at 1.7%. And if you break the economies down further, the projections look far worse, United Kingdom projected to go backwards at -0.6%, Germany 0.1%, Netherlands 0.6%, Luxembourg 1.1%.
Across here in Asia we have the worlds fastest growing economies with the highest expected GDP growth figures in 2023. Southeast Asia alone is projected to return between 4.9% and 5.2% in 2023. And looking at the individual markets the figures are completely in stark contrast to that of Europe, Thailand 3.7%, Indonesia 4.8%, Philippines 5%, Malaysia 4.4%, Cambodia 6.2%, China 5.2%.
One reason for this, as put forward by senior KPMG economist Ken Kim, is language and culture in Asia. In that ‘common language’ goes a long way in terms of facilitating business, especially when you have to facilitate business across languages. If you have a ‘common language’ it’s a lot easier to do business. Although the business world is becoming increasingly globalised, this has not resulted in a homogeneity of culture when it comes to services, products, desires and interests. And so people are choosing an easy approach rather than the best approach. Also lacking is a respected or trusted partner in the Asian economies.
Look no further than SCCG Asia, you partner here in Asia. A key reason we have established our Asian business is to provide certainty to the uncertainties. We are experts in Asian culture and business traditions, understanding the way in which decisions are made and how they are made. Business is international, few can escape this fact. Building business internationally allows for development and growth and at some stage you will need to consider how to deal with foreign clients, customers or currencies. As we always say, follow the data to get the best returns.