Asia's retail sector offer huge opportunities: PWC

Asia's retail sector offer huge opportunities: PWC

Agence France-Presse, Singapore

Asia's burgeoning retail sector offers huge opportunities to western players but they should pay careful attention to a range of corporate governance pitfalls, PricewaterhouseCoopers said on Monday.

"You should come but you should be aware of accountability, transparency and corporate controls," said Jacques-Etienne de T'Serclaes, global leader of retail and consumer products markets at the international consultancy firm.

"The region is not probably ... focused enough on corporate governance and transparency," he said at a media conference held on the sidelines of the World Economic Forum's East Asia summit.

"I am not saying on the form but more in substance and that has to do with a lot of family businesses."

Asia's weak corporate governance, particularly in family-owned firms, was exposed during the 1997-1998 financial crisis, sending the region's formerly booming economies into a tailspin.

Authorities have since undertaken much needed reforms across the region.

Despite the corporate governance concerns, de T'Serclaes highlighted the opportunities for western multinationals to enter the Asian retailing market.

He pointed out the region had demonstrated its ability to cope with major setbacks such as the recent Severe Acute Respiratory Syndrome epidemic and last year's terror attacks on the Indonesia resort island of Bali.

"I think in terms of opportunities, we should not undervalue the agility, the ability to cope, to adapt and to do better, of the region," de T'Serclaes said.

"The region will be developing rapidly in the next few years and will present strong competition but also tremendous opportunities for western countries."

In a report released here Monday at the WEF regional summit, PricewaterhouseCoopers placed a "go" recommendation to potential investors on four countries' retail sectors out of 14 surveyed between April and September.

The four countries -- China, South Korea, Thailand and Vietnam -- have retail sectors that are either still emerging or growing.

"In the emerging economies of the region, new niche opportunities are becoming apparent in secondary cities and even rural areas where modern retailing and consumer goods are as yet in their infancy," the report said.

Economies with a "wait" recommendation are Australia, Hong Kong, New Zealand and Singapore while India, Indonesia, Malaysia, the Philippines and Taiwan have a "caution" recommendation.