ASEAN Market Watch: Service Sector Declines in Singapore, Digital Initiatives in Thailand, and Improving Philippine Investor Confidence

Singapore: Business Receipts for Services Sector Down in Q1

Singapore recorded a fall in business receipts for the service sector in Q1 (first quarter) of 2016. The Department of Statistics states that receipts within the sector fell by 3.8 percent in Q1 compared to the last quarter of 2015.

Industries such as business services as well as recreation and personal services registered particularly significant declines, contracting by 7.5 and 7.3 percent respectively. In spite of the weakend performance in key areas, many industries – including education, health, and social services – retained strong growth.

While short term declines are a cause for concern and should be monitored closely in the months to come, overall business receipts have thus far remained steady, rising 0.3 percent year-on year. Economic analysts state the fall in receipts as symptomatic of the cautious approach to financial planning undertaken by most companies in the first quarter of every year and not indicative of an economic slowdown. 

RELATED: Pre Investment and Market Entry Advisory from Dezan Shira & Associates

Thailand: Digital Initiatives to Improve Business Competitiveness

Uttama Savanayana, Minister for Information and Communication Technology (ICT), recently indicated that the ICT Ministry will take up three digital initiatives to push the country towards ‘Thailand 4.0’ – a plan to help the country become a sustainable, value-based economy.

As part of this initiative, the ministry will:

• Build digital communities
• Create digital parks for small and medium sized enterprises (SMEs)
• Initiate digital innovative startup networks

All efforts will be launched this year and work to build a regulatory and technological environment aiding companies to develop digitally. If properly implemented, initiatives aim to usher in what officials have coined the ‘Digital Thailand’ scheme. At its height, Digital Thailand would likely result in boosts to productivity and increases in manufacturing competitiveness. Digitalization would also help to reduce bureaucratic and technological roadblocks that companies often face within the country and raise the profile of Thailand as an investment destination. 

 RELATED: The ASEAN Economic Community and What it Means for Intellectual Property

Philippines: Increase in Investment Underlines Heightened Investor Confidence

Investment pledges in the Philippines have shown a significant rise in Q1 of 2016. The Board of Investments (BOI) approved investments to the tune of U.S $2.5 billion – a 64 percent increase over the previous quarter. This growth has been driven by investment in infrastructure and energy projects.

The Department of Trade and Industry welcomed these figures but has decided to retain its growth target of five percent. Nonetheless, the uptake in investment pledges is noteworthy as the Philippines is one of the few countries that has managed to maintain its strong economic position despite a global economic slowdown. 

Economic analysts note that diversified sources of growth, including an unprecedented surge in the manufacturing sector, effective governance, and well-implemented reforms have contributed to the overall health of the Philippine economy. The increase in investment pledges also highlights high levels of investor confidence. Dezan Shira & Associates believe that investment into the Philippines is set to increase further in the coming months.

Annual Audit and Compliance in ASEAN
For the first issue of our ASEAN Briefing Magazine, we look at the different audit and compliance regulations of five of the main economies in ASEAN. We firstly focus on the accounting standards, filing processes, and requirements for Indonesia, Malaysia, Thailand and the Philippines. We then provide similar information on Singapore, and offer a closer examination of the city-state’s generous audit exemptions for small-and-medium sized enterprises.

The Trans-Pacific Partnership and its Impact on Asian Markets
The United States backed Trans-Pacific Partnership Agreement (TPP) includes six Asian economies – Australia, Brunei, Japan, Malaysia, Singapore and Vietnam, while Indonesia has expressed a keen willingness to join. However, the agreement’s potential impact will affect many others, not least of all China. In this issue of Asia Briefing magazine, we examine where the TPP agreement stands right now, look at the potential impact of the participating nations, as well as examine how it will affect Asian economies that have not been included.

An Introduction to Tax Treaties Throughout Asia
In this issue of Asia Briefing Magazine, we take a look at the various types of trade and tax treaties that exist between Asian nations. These include bilateral investment treaties, double tax treaties and free trade agreements – all of which directly affect businesses operating in Asia.

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