Page 244 - Foundations of Marketing

Reaching Global Markets | Chapter 8 211

trading partner, has initiated economic reforms to stimulate its economy by privatizing many
industries, restructuring its banking system, and increasing public spending on infrastructure.
China is a manufacturing powerhouse; however, its high growth rate has decreased in recent
51
years to about 8.0 percent. Many foreign companies, including Nike, Samsung, and Adidas,
have factories in China to take advantage of its low labor costs, and China has become a major
global producer in virtually every product category.
Pacific Rim regions like South Korea, Thailand, Singapore, Taiwan, and Hong Kong are
also major manufacturing and financial centers. Even before Korean brand names, such as
Samsung, Daewoo, and Hyundai, became household words, these products prospered under
U.S. company labels, including GE, GTE, RCA, and JCPenney. Singapore boasts huge global
markets for rubber goods and pharmaceuticals. Hong Kong is still a strong commercial cen-
ter after being transferred to Chinese control. Vietnam is one of Asia’s fastest-growing mar-
Association of Southeast Asian
kets for U.S. businesses, but Taiwan, given its stability and high educational attainment, has
Nations (ASEAN) An alliance
the most promising future of all the Pacific Rim nations as a strong local economy, and low that promotes trade and
import barriers draw increasing imports. The markets of APEC offer tremendous opportuni- economic integration
ties to marketers who understand them. For instance, YUM! Brands gets 60 percent of its among member nations in
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profits from overseas, much of it from APEC countries. Southeast Asia

Association of Southeast Asian
Nations (ASEAN)
The Association of Southeast Asian Nations (ASEAN) ,
established in 1967, promotes trade and economic integra-
tion among member nations in Southeast Asia. The trade
pact includes Malaysia, the Philippines, Singapore, Thailand,
Brunei Darussalam, Vietnam, Laos, Myanmar, Indonesia, and
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Cambodia. The region is home to 600 million people with a
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combined GDP of $ 2 trillion. With its motto, “One Vision,
One Identity, One Community,” member nations have
expressed the goal of encouraging free trade, peace, and col-
55
laboration between member countries. In 1993, the trade
bloc passed the Common Effective Preferential Tariff to
reduce or phase out tariffs between countries over a 10 -year
56
period as well as eliminate non-tariff trade barriers.
The economies of ASEAN countries are expanding at
an average of 5.5 percent, with Singapore listed among the
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top richest nations in the world. Yet, despite these positive
growth rates, ASEAN is facing many obstacles in becom-
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ing a unified trade bloc. The advertisement for the Asia
Foundation points out that while a major transformation
is taking place, many economic, social, and political chal-
lenges exist. However, it also indicates that strong institu-
tions and government policies are the key to growth and
stability. There have also been conflicts between members
themselves and concerns over issues such as human rights
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and disputed territories.
On the other hand, while many choose to compare ASEAN Courtesy of Asia Foundation
with the European Union, ASEAN members are careful to
point out their differences. Although members hope to increase
economic integration by 2015, they expressed that there will be
no common currency or fully free labor flows between mem-
Encouraging Economic Development in Asia
bers. In this way, ASEAN plans to avoid some of the pitfalls The Asia Foundation is a nongovernmental organization committed
that occurred among nations in the EU during the latest world- to economic prosperity, governance, and regional cooperation for
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wide recession. businesses and nations in the Asian-Pacific region.

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