Beyond China: south-east Asia’s next export stars

Short Briefings on Long Term Thinking - Baillie Gifford

China became known as the world’s factory thanks to it offering companies a way to manufacture all kinds of goods at a high quality and relatively low cost. But in recent years, south-east Asian nations, including Vietnam and Indonesia, have begun challenging it for that status. Baillie Gifford investment manager Ben Durrant recently returned from a tour of the region. He discusses some of the long-term growth opportunities he unearthed on his trip.

Background

Ben Durrant invests on behalf of the Pacific Horizon Investment Trust, the Pacific Fund, and our Emerging Markets Equity Team. In this latest episode of Short Briefings on Long Term Thinking, he explores the factors that led China to become the world’s leading exporter and how its move up the value chain is now creating opportunities for other south-east Asian countries to grasp. Durrant reviews some of his most memorable encounters in Vietnam, Indonesia, Malaysia and Thailand and reveals which growth companies excited him the most. They include businesses using mined metals to make car batteries, banks serving populations with growing spending power and, perhaps surprisingly, one of the world’s leading catfish exporters.

Resources:

The Indonesian companies powering the green transition

Ben Durrant LinkedIn page

How Asia Works

How the World Really Works

Past podcasts

Timecodes:

00:00 Introduction

01:30 China’s success as a low-cost exporter

03:15 Land reform’s role

04:00 Good quality, low-cost labour

05:45 South-east Asian countries’ advantage

07:15 Vietnam’s growth opportunity

09:30 Vin Hoan: exporting catfish

11:45 Sourcing local insights

13:30 Indonesia’s move up the value chain

16:15 Clusters of expertise in Malaysia

18:00 Looking beyond tourism in Thailand

20:15 Moving up the value chain

22:15 The attraction of growth investing in southeast Asian

23:15 Paying attention to macroeconomics

24:30 Book recommendation

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Companies mentioned include:

FPT

Hyundai

Samsung Electronics

Vinh Hoan