Not surprising, three emerging Asian countries out of the top five were voted as the most likely to pay bribes to win business in other countries. In a survey conducted by anti-corruption organization Transparency International, Russia was voted the most likely to pay bribes, followed by China and India. Conversely, wealthier, more developed countries Belgium, Canada and the Netherlands were voted the least likely to pay bribes to win business in other countries.

In the previous Bribe Payers Index (BPI), published in 2006, India was named as the worst, followed by China and Russia, while Switzerland, Sweden and Australia got the highest scores.

Looking at the larger picture, experts who specialize in governance relate a country’s level of corruption to long-term economic growth and investment. In Asia, this means countries  such as Singapore and Hong Kong which have made concerted efforts to stamp out corruption have witnessed higher growth and FDI inflows as compared to country’s such as Myanmar which was ranked amongst the world’s most corrupt countries by TI. Of the emerging countries, Malaysia ranks high, followed by Thailand, Vietnam, Indonesia and the Philippines in that order.

(more…)

As companies begin to downsize and trim the fat globally, they are looking at outsourcing many operations to lower cost destinations. While undisputed leader in offshore services India and her greatest challenger in terms of potential scale China continue to remain top destinations for companies looking at cutting costs Vietnam and Thailand too have aggressively captured a larger share of the world outsourcing pie.

According to Gartner’s 30 Top countries for Offshore Services in 2008 report, 10 Asia Pacific countries made it to the list. Amongst them were Australia, China, India, Malaysia, New Zealand, Pakistan, the Philippines, Singapore, Thailand and Vietnam. The IT research and advisory company said costs, language skills, cultural compatibility, time zone and travel time were important considerations in choosing these locations. Further, many customers preferred Australia, New Zealand and Singapore due to their mature environments while others outsourced to Malaysia, Pakistan, the Philippines, Thailand, and Vietnam for cost benefits.

(more…)

A recent research report voted Tokyo, as the best place to buy real estate next year and Ho Chi Minh City as the best market for office, retail and apartment residential property. Singapore and Hong kong followed Tokyo while Mumbai, Shanghai and Bangalore followed Vietnam’s former capital city. The survey Emerging Trends in Real Estate Asia Pacific was released by the Urban Land Institute and PricewaterhouseCoopers LLP.

With property values tumbling worldwide, the report found Tokyo to be least risky due to its comparatively stronger economy, high liquidity levels and quality structures. Among the 180 executives surveyed, 40 percent recommended “hold” for properties in Tokyo, 32 percent suggested “buy” and the rest said “sell” for real estate in the city, Bloomberg reported. As Tokyo rose in the ranking’s Shanghai fell from being the best place to invest in real estate to the fifth slot.

(more…)

Even though Asia hasn’t been affected by the financial crisis as much as the United States or Europe, foreign investors are still shy to bank their money in the region. A recent Reuters analysis on central bank data pointed out that foreign exchange reserves in Asia (excluding China) plummeted by US$119 billion in October to US$2.34 trillion.

India led the fall, dropping forex reserves by US$38.9 billion, while South Korea marked a drop of US$27.4 billion. Singapore, Malaysia, Indonesia and Pakistan were other countries in the region which reported a decrease in their forex holdings as compared to the same time last year. China, holder of the world’s largest reserves, releases data at the end of every quarter.

Foreign investors have sold US$63 billion worth of shares in Asia ex-Japan so far this year, led by the sale of US$33 billion in South Korea, nearly US$14 billion in Taiwan and almost US$12 billion in India, Reuters quoted Nomura.

(more…)

This year it is believed that the number of people living in urban areas exceeded those in the countryside for the first time ever. This growing urban population breeds income inequalities which fuel negative social tensions.

“High levels of inequality can lead to negative social, economic and political consequences that have a destabilizing effect on societies,” said the State of the World’s Cities 2008/2009 report. “[They] create social and political fractures that can develop into social unrest and insecurity.”

Not surprisingly then the report finds that as populations rise, as they have in emerging Asia, inequalities widen, giving rise to food, religious, political and social riots as we have seen spreading across Asia. In the past few months, high oil prices competing with even higher inflation rates have widened the gap between the rich and poor leading to political clashes in Thailand, religious riots in India, as well as social unrest in China and the Philippines.

(more…)

Asia hosts 15 of the top 30 cities expected to drive growth globally, according to the 2008 Mastercard Worldwide Centers of Commerce: Emerging markets Index. While Chinese cities—15 out of 65 including Shanghai, Beijing, Guangzhou and Shenzhen—dominated the index, Mumbai represented India in the top 20 and Kuala Lumpur and Bangkok also proved themselves as strong regional growth hubs amongst Asian nations.

The report says it compares emerging cities as regional growth hubs as compared to countries as due to their dense, hybrid populations its these cities that have emerged as financial and intellectual growth engines rather than the countries they belong to.

(more…)

Emerging Asia faces weaker economic growth prospects in the coming year amid slowing demand and financial turmoil in Western economies, the International Monetary Fund said on Wednesday.

‘More weakness is expected ahead in response to slowing demand from advanced economies and growing strains in regional financial markets,’ the IMF said in its twice-yearly World Economic Outlook report.

‘The main concern is that a buildup of stress in the global financial system and a sharper-than-anticipated global slowdown could further weigh on activity,’ it said.

Regional locomotives China and India will also experience slower growth on weaker exports, but should continue to be supported by solid private consumption, it said.

Growth in China is likely to come in at 9.7 percent this year, and 9.3 percent in 2009 — compared to 11.9 percent in 2007, the IMF said. India will grow 7.9 percent this year and 6.9 percent in 2009, off from 9.3 percent in 2007, Forbes said.

(more…)

A recent International Monetary Fund report revels that in emerging Asia, current accounts—the most important part of which is balance of trade—averaged a surplus of about 5 percent of GDP in 2007, while in emerging Europe current accounts reached on average a deficit of 10 percent of GDP in 2007.

The IMF attributes the divergent current account patterns to the connection between economic development and capital flows. Virtually all the emerging economies have achieved high growth during the past decade, with very different current account positions.

The fund explains that although different Asian economies added varied amounts to their current accounts at different times, under different circumstances in general, the region has seen their current account kitty bulging due to two main reasons.

First, high growth and the resulting profitable investment opportunities should make the country attractive to foreign capital. Second, if individuals want to smooth their consumption over time, prospects of continued high growth should lead to higher consumption today because income and consumption can be expected to rise further in the future, the IMF reported.

(more…)

The ease of doing business across Asia varies significantly. According to the ‘Doing Business Report 2009’ prepared jointly by the International Finance Corporation and the World Bank, Singapore retains its number one position on the overall regulatory ease of doing business for a third consecutive year. While due to poignant regulatory reforms China’s rank improved from 83 from 90, out of 181 countries. India, however, slipped two notches to rank at 122nd, below its neighbors - Nepal, Bangladesh and Pakistan which have been placed 121, 110 and 77 respectively, in the overall ranking.

Among Asia-Pacific countries, the Philippines ranked 140th, lags most of Asia for ease of doing business was behind even Cambodia at 135 and only ahead of Laos at 165 and East Timor at 170. The average ranking for East Asia is 8. Consequently, Bangladesh is ranked 110 and has reduced the time needed to register property from 425 to 245 days. Bhutan is ranked 124th. (more…)