Eric Chin (@EricJYChin), Senior Analyst to the professions on strategy, structure, capital, recoveries and removals at Beaton Capital in Melbourne has just published new research marking occasions for international law firms in the Asia Pacific region.
As Chin frames: “The Asian Century is upon us. And from many unreliable accounts, this is also true for professional service law firms in Asia, looking to expand into Asia’s appearing markets in search of new sources of growth. Beaton Capital’s recent study of the Asia-Pacific Region reveals five reasons why we’re observing the rise of Asian business empires”
Chin goes on to provide a snapshot of each of the five reasons, which include:
Rise of Asia-Pacific’s economies — Chin explains that “‘The Asia-Pacific is a US$17 trillion economy that has grown at 8% compound annual growth rate (CAGR) for the last decade'” — and “is home to over 60% of the world’s population. Besides, Beaton Research studied 14 economies of the region. And each “is displaying distinctive comparative advantages enabling them to enter the world trading arena. It is further paving the way for greater economic linkages.”
Rise of Asia-Pacific’s trade blocs — Chin outlines here that “The countries in Asia-Pacific are more connected than ever with the establishment of trade blocs.” He cites in particular how if the Regional Comprehensive Economic Partnership (RCEP} “is successfully implemented. The law firms in Asia will further create the world’s largest trading bloc. Moreover, it involves 16 countries with a combined GDP of $17 trillion and covering 3 billion people.”
Rise of Asia-Pacific’s billionaires — “Wealth is being created in the Region at an unprecedented pace.”, Chin writes. He explains that: “The combined wealth in the Region counted US$1.145 trillion in 2013. Some of this wealth is in generational shift as Asia’s tycoons are handing over their empires to their largely western-educated children. The bamboo network which has been an impenetrable barrier around the tycoons may soon change as the generational handover completes.”
Rise of Asia-Pacific’s stock exchanges — Last year, as Chin writes, “the World Federation of Exchanges reported the Region is second only to the Americas by market capitalisation. All in all, access to capital will continue to create the Region’s multinationals.” Chin highlighted in particular robust exchange activity in Japan, China and India.
Rise of Asia-Pacific’s multinationals — “Driven by strong domestic markets and endowed with richly resourced lands, Asia-Pacific’s Fortune companies are growing in numbers”, as Chin outlines.
Implications for international law firms
“Leaders in professional services law firms in Asia should adopt five critical actions in the face of the five occasions.” Chin outlines the following:
- Understand the unique economic drivers in each of the countries in the region.
- “Integrate service offerings across the Region based on quality, breadth and depth.”
- Become an optimal planning advisor to family-owned conglomerates.
- Seek prime IPO candidates.
- Help Asia’s multinationals achieve global policies.