SOUTHEAST Asian companies are actively evaluating potential investments in African markets as they seek to support their growth and explore fresh opportunities amid the economic deceleration in China. Arsjad Rasjid, Chairman of the ASEAN Business Advisory Council, shared insights during a recent interview, acknowledging that China’s slowdown does have a ‘definite’ impact on the Southeast Asian region, given its robust trade connections with the world’s second-largest economy. However, he emphasised that this situation can be viewed positively.
Rasjid remarked, ‘What is important to see is that we are now looking at other nontraditional markets,’ with a particular focus on Africa. He highlighted Africa’s immense potential, boasting a population exceeding 1 billion, making it an attractive prospect for companies worldwide.
In a notable development, Indonesian President Joko Widodo embarked on his inaugural trip to Africa in late August, signalling a shift in Indonesia’s economic diplomacy. This journey encompassed visits to Kenya, Tanzania, Mozambique, and South Africa and aimed to explore new export markets for pharmaceutical products and commodities, including palm oil.
While Rasjid did not specify particular African countries, he disclosed that ASEAN nations are actively assessing areas where demand exists. He also stressed the importance of ASEAN’s investment in African infrastructure to facilitate efficient trade between the two regions.
Some Southeast Asian companies are already established in the African market. Indofood, a subsidiary of the Indonesian conglomerate Salim Group, has successfully distributed its flagship instant noodle brand, Indomie, in countries like Kenya, Tanzania, and Uganda. Thailand’s Mega Lifesciences has made investments in 10 African countries, offering herbal nutrition supplements and medications.
However, it is crucial to acknowledge China’s more substantial presence in Africa. Over the years, Beijing has established extensive influence and partnerships with several African nations, emerging as a major financier of infrastructure projects in Africa through President Xi Jinping’s Belt and Road Initiative.
Rasjid emphasised the importance of collaboration and responsible business practices, saying, ‘How can we work with the local businesses or the best local partners … is very important.’ He noted that some countries have encountered challenges related to debt from China and concerns about an excessive reliance on Chinese labour over local workers.
‘We recognise that when people come to [ASEAN], we want to have the local opportunities. So the same thing with Africa,’ Rasjid affirmed, underscoring the commitment to contributing to the region’s growth while fostering mutual benefits and sustainable development.