02 NOVEMBER 2022View in Browser
 
 
 

This week's primary foreign investment news
from our ASEAN, China, India, Russia, Belt & Road and Vietnam Briefings.
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HEADLINES:

Curated by Chris Devonshire-Ellis

Further to the CPC Congress announcements on reforms for foreign investment in China’s domestic markets, Beijing has issued an expansion of the ‘Encouraged Industry’ Catalogue which includes Hi-Tech, Green, Healthcare, Elder Care, Sports and Vocational Training Sectors. We pay particular attention to China’s emerging Esports sector.

In ASEAN, we look into the Philippines expanded foreign investment catalogue, and look at potential in Vietnam’s pre-school sector as well as Indonesia and Thailand’s mutual QR code linkage. We look at India’s growing healthcare industry and its emerging second and third tier cities and how to assess their market potential, while in the Middle-East, Turkiye has just had record exports. We discuss why and how Turkiye is becoming an export manufacturing hot spot. Finally we look at the Belt & Road Initiative and provide our usual weekly roundup.

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CHINA
China Further Expands the Encouraged Catalogue to Boost Foreign Investment
We highlight new opportunities in China’s “2022 Catalogue of Encouraged Industries for Foreign Investment”, which contains 1,474 items. These align with China’s plans to attract foreign investments into high-tech manufacturing, production-oriented service industries, as well as regional advanced industries in the central, western, and northeastern regions. Opportunities also exist in industries linked to green, healthcare, elder care, sports, and vocational education sectors besides rural revitalization.
 
More Than a Hobby: Understanding the Esports Market in China
Esports, short for electronic sports, is a variant of competition based on video games. It has gained in popularity across the world since the 2000s as internet access has widened, turning a leisure hobby into an industry that’s worth billions. In 2022, global esports tournaments have been expected to rake in US$1.4 billion in revenue and the figure may grow to US$1.9 billion by 2025. An emerging and relatively niche market, esports has gained in popularity among the younger demographic, generating millions in revenues. In this article, we explore the opportunities and risks in the industry in China.
 
ASEAN
The Untapped Potential in Vietnam’s Pre-school Market
The number of foreign investment projects in Vietnam’s education sector has climbed by 606, with a total registered capital of about US$4.5 billion (accumulated as of May 2022). Foreign investment in education has not been commensurate with its potential. Competitors in the market, while numerous, showcase the viability of the Vietnamese market rather than provide a serious threat to new market entrants.
 
Indonesia and Thailand Implement QR Payment Linkage, Key to Increasing Digital Integration in Southeast Asia
Indonesia and Thailand have implemented a cross-border quick response (QR) payment linkage, meaning consumers can use their mobile applications to scan the QR codes for products and services from either country. This initiative is in line with Southeast Asia’s increasingly integrated digital economy such that consumers from the ASEAN bloc will be able to undertake cross-border transactions with greater ease.
 
The Philippines’ 12th Foreign Investment Negative List: Implications for Foreign Investors
The Philippines’ 12th Regular Foreign Investment Negative List was recently issued, and provides foreign investors with greater access to the Filipino economy and markets. The changes reflect the country’s desire to liberalize the investment environment and ably compete with neighbors in the fast-growing ASEAN economy. We explain the new market sectors open to foreign investors.
 
INDIA
Tax and Incentive Policies to Spur Investment in India’s Healthcare Sector
Following Covid, India rolled out tax and other incentive policies and reforms to boost the overall capability and investment viability of its healthcare sector and the domestic manufacturing ecosystem linked to healthcare services. This has contributed to the growth of the Indian medical value travel market – poised to reach US$13 billion by 2026. We look at some of the prominent tax and FDI policies and reform initiatives facilitating investment growth in the healthcare sector in India.
 
India’s Tier 2 and Tier 3 Cities: Are They Right for Your Business
Foreign investors interested in locating in a tier 2 or tier 3 Indian city should carefully consider their options: lower tier cities offer comparatively cheap labor and affordable real estate, but setting up in these cities also comes with challenges. According to the government, cities with a population in the range of 50,000 to 100,000 are classified as tier 2 cities, while those with a population of 20,000 to 50,000 are classified as tier 3 cities. In a populous country like India, cities of this size are common and does not correlate with any potential for economic development. Research is key.
 
MIDDLE EAST
Turkiye’s Exports Have Reached the Highest Export Levels in the Country’s History
Turkiye’s Ministry of Trade has announced its foreign trade statistics for September 2022. According to the data, exports increased by 9.2% in September compared to the relevant month in 2021, reaching US$22.62 billion. This amount is the countries highest ever September export figure. Imports also increased by 41.5% in the same period and reached US$33 billion. The increasing of the national foreign trade volume shows that Turkiye is a growing and developing actor in world trade.
 
BELT & ROAD INITIATIVE
Belt And Road Weekly Investor Intelligence #105
This week we examine the potential demand for China manufacturing in the wake of the CPC Congress reforms, and delve into the Q3 trade figures to see pointers for 2023. Along the BRI, we see how the Ukraine conflict is affecting demand in Kazakhstan and Turkiye, and look at the proposals for a joint Azerbaijani-Iranian JV operator for the Western end of the INSTC, which will include managing goods transit to Europe. We look at why North Korea is opening 6 “trade offices” in Russia and the implications of Huawei leaving the Russia market.
 
 
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