Losing Tiger, Hidden Fortune

The Economist asks, "Other emerging economies are producing world-class companies by the dozen. Why aren't the countries of South-East Asia?"

You may be tempted to damn politically connected entrepreneurs, or the old stories of rent seeking, corruption, and cronyism. But the magazine cleverly avoids to replay these old songs, as it writes:

Similar things were once said of much of the rest of Asia—and sometimes still are. But somehow other countries' top businesses, even in India, the home of the licence Raj, have escaped this mediocrity trap.

So what are the problems of us, the losing tigers? First, diverse and fragmented SEA market (think of more unified China and India) prevents economies of scale in the local market. Second, lack of technology and higher education promotion results in SEA's middling labor productivity growth (in contrast to climbing East and South Asia's figures--look the very important Graph 3). And third, the conglomerates is less focused in doing particular industry. They want to do everything, --and goes nowhere.

I think above are well observed points. Yet, it is rather a too broad analysis on business climate. More micro analysis, like a thorough observation at firms level on, say, how Tata of India or Lenovo of China have managed their way up would help more.

Are we gonna be able to see 30 (or 50) Indonesian firms in Fortune Global 500 list in 2030? I do hope we can. It isn't a too ambitious project. China has 24 firms, India 6, and Brazil 5 on the list.

In 2007, I must add.