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Member News

Asia Business Council 2017 Annual Members’ Survey Summary

2017 Autumn Forum in Review

Asia Business Council Briefing Synopsis: Artificial Intelligence in Asia: Preparedness and Resilience

Upcoming Forum Dates

OCTOBER 2017 Member News  Morris Chang of TSMC was named as one of the world’s “100 Greatest Living Business Minds” in a recent Forbes report. He also confirmed that TSMC’s production and R&D base will stay in and announced his plan to retire from TSMC in June 2018.  Tony Fernandes of AirAsia discussed a new deal with Inmarsat to provide broadband access on the airline’s Airbus A320s and A330s. He also talked about the benefits of competition among airlines in Asia and of the need for AirAsia to focus on what it does best.  Atsushi Horiba of HORIBA, Ltd. stated his belief that electric vehicles will always make up less than a third of autos globally, citing the scale of infrastructure as a key limiting factor.  Aloke Lohia of Indorama Ventures announced the entrance of the company onto the Dow Jones Sustainability Index.  Takeshi Niinami of Suntory Holdings expressed his support for the victims of Hurricane Harvey and Hurricane Irma after the announcement of a $1 million donation to the American Red Cross’s recovery efforts.  Serge Pun of Yoma Strategic Holdings highlighted opportunities for the Japanese service industry in Myanmar at the Myanmar Economic Seminar in Tokyo. He also spoke on a panel about global shifts and Asia at the Milken Institute Asia Summit 2017.  Penny Pritzker of PSP Capital Partners joined the board of directors of Measure, a provider of drone solutions for enterprises.  Nazir Razak of CIMB Group commented that Malaysia’s economic momentum will pick up after the upcoming general election.  Takumi Shibata of Nikko Asset Management spoke about his views on market response to geopolitical risk, investment opportunities in the region, and the strength of the Japanese yen, in an interview with CNBC at the Singapore Summit. He also discussed Nikko’s Global Robotics Equity Fund while at the Summit and spoke on a panel about the future of Japan’s economy at the Milken Institute Asia Summit 2017.  Yasuhiro Sato of Mizuho Group discussed the company’s leading role in the development of a new digital currency, J-coin.  Peter Voser attended the Singapore Summit and answered questions on a range of issues in an interview with CNBC, including the need for multiple nations to drive climate change policy, opportunities in the electric vehicle market in cities, and his company’s investment in the U.S.  Yuanqing Yang of Lenovo Group discussed the company’s strong growth in BRICS markets, especially in the smartphone and personal computer categories.  Jaime Zobel de Ayala of Ayala Corp. was one of ten business leaders named as a United Nations SDG Pioneer in sustainable business strategy and operations. The award was in recognition for his work as a corporate champion of the UN’s Sustainable Development Goals. He also spoke on a panel about the future of jobs at the Milken Institute Asia Summit 2017.  Two additional Asia Business Council members spoke at the Milken Institute Asia Summit 2017. Teresita Sy-Coson of SM Investments Corp. also spoke on a panel about global shifts and Asia, and Weijian Shan of PAG Group spoke on a panel about trade and investment in .

Asia Business Council 2017 Annual Members’ Survey Summary The Asia Business Council’s twelfth annual survey of members was conducted in July 2017. With an overall response rate of 85%, the majority of members (55%) are expecting business conditions to remain about the same in the next 12 months. Increased optimism over business conditions is at its highest in three years, with only 5% of members expecting them to worsen, and 40% of members expecting them to improve over the next 12 months. The most commonly-cited economic problems for Asia were heightened geopolitical tensions over North Korea, as well as protectionism and economic nationalism. Views on China’s economy were mixed; some members expressed concerns over excess credit and overcapacity, while others were optimistic about the transition from an export orientation to domestic consumption. Respondents were very optimistic over the economies of Japan and India. The U.S. remained the top investment destination over the past year, while China tops the list for planned investments over the next 1-3 years. Investment enthusiasm toward ASEAN was noticeably lackluster, especially in its emerging economies. Geopolitical issues were cited as “very important” for business in Asia by 56% of respondents, compared to just 35% five years ago. Finance and business issues were of most concern to members’ own businesses, and adapting to and integrating new technologies, navigating complex regulatory environments, and slow growth were mentioned as common concerns. For a more detailed executive summary, click here.

2017 Autumn Forum in Review The Asia Business Council’s 2017 Autumn Forum was held in Taipei, September 28-30. The pre-Forum trip included a trip to Songshan Cultural and Creative Park, where members saw how the former state tobacco factory has been re-purposed and is contributing to the development of the arts in Taipei. The Autumn Forum officially began with a Welcome Dinner at the Taipei New Horizon Building, where the Mayor of Taipei, Dr. Ko Wen-Je, discussed Taipei’s dynamic economic role in Taiwan and his plans to make Taipei a “smart city.” The Forum sessions took place over the following two days at Shangri-La’s Far Eastern Plaza Hotel Taipei. The Forum Dinner, hosted by Foreign Minister Dr. David Tawei Lee, was held at Taipei Guest House, where President Tsai Ing-Wen addressed the participants on Taiwan’s economic opportunities and challenges and answered questions from the audience.

A wide range of topics were covered by members and guests at the Round-Robin discussion, including future directions of economic growth in China; Japan’s labor shortages, rising healthcare costs, and investments in disruptive technologies; implications and repercussions of demonetization in India, as well as the country’s efforts to move into the digital age; infrastructure needs in ASEAN and China’s dominance in the region economically, politically, and militarily; the growing divisions in Europe between those who have enjoyed the fruits of globalization versus those who have not, as well as new labor policies in France and the implications of the German elections; the new royal decree in Saudi Arabia allowing women to drive and the implementation of Vision 2030, as well as geopolitical tensions in the Gulf, notably those centering on Qatar and Yemen; and, in South Korea, anti-business sentiments as well as tensions with China over North Korea. Participants also commented on challenges related to the workforce of the future and the Fourth Industrial Revolution.

The Round-Robin concluded with remarks by Penny Pritzker, Founder and Chairman of PSP Capital Partners and former U.S. Secretary of Commerce who spoke about her perspectives on the current U.S. administration and addressed the sources of political dysfunction and economic discontent in the U.S. Ms. Pritzker outlined the need for tax and immigration reform, more investment in digital infrastructure, and retraining programs that better prepare workers for technology-fueled disruptions.

In the afternoon session on Future Directions for Taiwan’s Large Companies, the economic effects of strained cross-Strait relations, Taiwan’s inability to join the TPP, problems resulting from an ageing population and low birthrate, and questions over how Taiwanese companies can utilize Big Data, Virtual Reality, and Autonomous Robots to help stimulate faster growth were discussed. Issues over identity, especially among younger generations, were also a focal point of the discussion. The following session’s panelists spoke on geopolitical tensions in Northeast Asia, including upcoming elections in Japan, Prime Minister Shinzo Abe’s decreasing popularity, and the need for him to successfully address problems stemming from a declining population and the nuclear crisis in North Korea; how problems on the Korean peninsula are serving as a platform for more dialogue between China and Japan; the need for companies based in South Korea to come up with contingency plans, including an evacuation plan, in the event of escalation of aggression with North Korea; and how the high- income trap and growing economic discontent is contributing to increasing polarization worldwide.

Saturday morning began with the session Artificial Intelligence: What Every Business Needs to Know, which began with a symphony composed by AI and a pointed message that AI will be a game changer in every industry, followed by a tutorial of what AI is and of its applications in e-commerce, animation, customer optimization and personalization, interactive decision-making tools, cybersecurity, and consumer finance. The forum ended with a final session on New Faces of Taiwanese Entrepreneurship, which discussed how established ICT companies in Taiwan are starting to work alongside business accelerators to foster entrepreneurship and greater application of new technologies, such as AI, and Taiwan’s competitive advantage in having a strong and adaptive supply chain ecosystem.

All presentations and summary notes from the Autumn Forum in Taipei will be available on our secured participants-only website. The username and password will be sent to participants separately.

Synopsis of Asia Business Council briefing: Artificial Intelligence in Asia: Preparedness and Resilience Artificial Intelligence (AI) has begun to transform businesses, jobs, and economies. Machines are increasingly able to perform tasks that only humans could do previously and are starting to generate results or insights by themselves without being explicitly programmed. As a result of these developments, AI presents an enormous opportunity—those economies that can use AI to help with growth will improve economic competitiveness, capture value in multiple industries, and transform the lives of millions of people. With this in mind, the Asia Business Council developed an Asian Index of Artificial Intelligence to analyze the preparedness and resilience of eight Asian economies with respect to an AI-led future for their economies and societies. Preparedness measures the extent to which companies and talent can capitalize on AI opportunities, while resilience measures the extent to which governments and societies can adapt to and withstand broader structural changes resulting from AI use. Index results showed that out of the eight economies analyzed, China topped the overall ranking with a big lead. Singapore and India followed. Japan, Taiwan, and South Korea ranked in the middle, and and Indonesia ranked relatively low overall.

Asia is at the beginning stages of an AI revolution. Surviving and thriving in this AI age requires transformative business practices and policies. A new generation may lead this growth, but the existing business leaders and policymakers who bring experience in running companies and making policies, have opportunities to change and adjust now, to ensure that AI will be a driver of positive change in their economies and societies in the future. AI poses significant challenges, ranging from job destruction to invasion of privacy. Based on our research, it is clear that prepared and resilient economies will reap enormous gains in growth and progress in the global digital economy, while those that are not risk being left behind. To read our research brief in full, please click here.

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U p c o m i n g ẁF o r u m ẁD a t e s 2018 Spring Forum: Manila, February 6-8 (2018 Winter Olympics Opening Ceremony in Pyeongchang, Seoul February 9-10) 2018 Optional Council Trip to Israel, May 5-10 2018 Autumn Forum: Shenzhen, September 27-29

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