The Asian Century is here.
In his most recent book The Future Is Asian, Parag Khanna wrote that Asia is taking its place alongside North America and Europe as a major power center of the world. Last year the World Economic Forum also predicted that the year 2020 would mark the beginning of the Asian Century.
Even under the new normal caused by the Covid-19 pandemic, the International Monetary Fund has said that emerging Asian economies are the only regions with anticipated GDP growth – albeit by a mere 1% – in 2020 while the rest of the world has negative growth.
Not surprisingly, Singapore – the world’s most open and competitive economy according to the latest Global Competitiveness Report – is gaining momentum.
Opportunities from crisis
Amid the geopolitical tensions between China and the United States, Singapore is emerging as a new hub for Chinese tech giants with recent announcements from ByteDance and Tencent on making the city-state their beachhead for the region.
Speaking at the Global Innovation and Technology Forum (GITF) held on Monday, Kay Mok Ku, managing partner for Southeast Asia of Gobi Partners, a Chinese venture fund, was bullish about the role of Singapore to help Chinese tech firms export their technologies overseas against the backdrop of tech bans in the United States and India.
“We are seeing the beginning of Chinese companies using Singapore as a global hub,” he said. Citing semiconductors, hardware and applications as examples, Ku opined that Chinese technologies need to be integrated with western technologies before going international and that is the niche Singapore can fill.
While China shifts its focus to a so-called dual-circulation strategy – a combination of “internal circulation” and “external circulation” – for the country’s long-term development, Singapore’s role will be critical in combining original Chinese technologies with Western technologies.
Multi-trillion-dollar ASEAN economies
In addition to being a springboard for Chinese technologies, Singapore could position itself as a hub of the Association of Southeast Asian Nations, Ku added.
According to the Economist Intelligence Unit, the ASEAN region has the potential to create the world’s largest free-trade area, building on innovation and digital technologies to add an estimated US$1 trillion to regional gross domestic product.
Carousell, an online marketplace headquartered in Singapore, is one of those success cases with its footprints in the ASEAN region including Malaysia, Indonesia, Vietnam and the Philippines. To date, Carousell is valued at over US$900 million, with the potential to become Singapore’s next unicorn.
To tap the ASEAN market, Carousell’s co-founder Lucas Ngoo emphasized that localization is key. “When thinking of Southeast Asia, many people see it as one giant area. But there are different cultures, different languages, different infrastructures, and even different segments within the banked and the unbanked population.”
As such, when entering a new market, Carousell has a dedicated team to localize its offerings, from languages to cultural norms and from payment system to logistic flow, according to Ngoo.
Drivers to innovation
Singapore is highly popular as a hub for innovation and entrepreneurship in Asia and it is now the home of four unicorns – Grab, Sea, Lazada and Razer.
While the government plays an instrumental role in providing funding for research, Lily Kong, president of Singapore Management University, believes that universities are also key drivers of innovation.
Industry-university partnership is one example. Kong thinks that the universities can work with industry in multiple ways, from co-founding corporate labs to sending students to work with industry and partnering a range of companies with a specific focus.
Another example is nurturing the next generation of entrepreneurs. Ngoo credited his alma mater the National University of Singapore for an opportunity to spend a year in Silicon Valley, which led him to a successful entrepreneurial career.
While many aspiring entrepreneurs look to the West for inspiration, Kong encouraged students to understand the Asian region better.
“We have often heard about this century being the Asian Century,” she said. “Despite Covid-19, Asia still holds a lot of promise. The key is to promote the importance of Asia and understanding Asia with its complexities in different cultures and regulations.”
Brian Yeung is the founder of Brianstorm Content Solutions and the author of Stepping Inside a Foreign Land – Russia, published in 2020. With a decade of experience as a communications professional, he has contributed to more than 10 Chinese, English and Russian media including print, online and broadcast.