Michael Bleby Reporter

Michael writes on emerging markets, architecture and engineering. He has served as a correspondent in Tokyo, London and Johannesburg and has written for Reuters, the Financial Times, The Age and The Sydney Morning Herald.

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Asian investors turn their backs on Europe, US

Published 05 December 2012 05:52, Updated 06 December 2012 05:09

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Asian investors turn their backs on Europe, US

Intra-Asian investment has been given a push by the global financial crisis. Illustration: Sam Bennett

Foreigners are not the only ones looking to invest in Asia. Not surprisingly, Asian investors are looking at the growth in their own backyard for returns and are increasingly funding that growth, too.

As many as 79 per cent of Asian property investors regard their home region as their key investment focus, with the Pacific region accounting for the next 11 per cent, real estate company Colliers’ 2013 Global Investor Sentiment Survey says. Europe and the US fall into the remaining 20 per cent along with all other regions of the world.

“An investment management company based in China mentioned their reason for investing in Asia is because the region is still in a fast-growing developing stage driven by urbanisation and supporting government initiatives,” the report says.

Intra-Asian investment is not new but has been given a push by the global financial crisis of 2008 that dampened prospects in Western Europe and the US. ANZ bank’s Asia Pacific chief executive Gilles Planté said last month that across the Asean region, the percentage of long -term debt funded by Asia rose from 16 per cent in 2001 to 51 per cent in 2010. For short-term debt the figure jumped from 15 per cent to 70 per cent.

“The clear trend we have been seeing is a substantial rise in intra-Asian flows, which we think will be an increasing feature of the Asian financial landscape,” Planté told the 2012 Australia-Thailand Business Conference in Bangkok. “The rich Asian countries are turning to Asia for their future rather than the US or Europe. They are investing in an Asian future.”

This growing rise of intra-Asian business has already prompted some companies, such as health insurance provider nib, to talk about harnessing those opportunities.

“An Indonesian businessman travelling to Malaysia and working a few weeks does need global cover,” nib chief executive Mark Fitzgibbon told BRW earlier this year. “There’s an opportunity we sense of being involved in that cross-border activity, as distinct from domestic activity.”

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