HSBC urges firms to shift focus to Asia
IRISH COMPANIES need to shift focus away from developed markets and look at opportunities in Asia, says Ananth Krishnan, head of trade and supply chain at HSBC Ireland.
“With recession hitting developed markets, companies need to shift focus towards Asian markets,” said Krishnan.
“From a strategic point of view, very clearly the mindset of Irish companies is shifting to Asia. Irish companies very clearly know they have to go in these markets and they are making efforts.”
Among the companies that have developed this strategy are the multinationals working in Ireland in sectors such as pharmaceuticals, chemicals and medical devices.
The printing sector is also expected to see fast growth in exporting to Asia, but the biggest of all will be the agrifood business.
A phalanx of Irish Government ministers have been coming to Asia in recent times. Taoiseach Enda Kenny was in China in March, and Minister for Health James Reilly, Minister for Jobs, Enterprise and Innovation Richard Bruton, and Minister for Agriculture Simon Coveney have all been here this year.
The end of milk quotas next year will be a big opportunity for Irish dairy companies to increase production and sell to new markets, including Asia.
A significant factor is the middle class populations where demand for high-quality branded products is high and people are prepared to spend more to pay for it, said Krishnan. People need to broaden their view to encompass other areas in Asia, not just China, he said.
“Companies have a lot of focus on China for now. They do need to realise that Asia is not just China. That said, China will be hugely important, by 2050 China will be the leading economy in the world. All trends point out that China has tremendous potential,” he said.
As well as China, India has huge potential. The government recently announced a massive investment in infrastructure, which could offer opportunities for Irish firms.
“You have to do your homework and do your research. Irish companies need to ask advice before heading out. You can’t treat Asia as a single market, there are many markets in many countries,” he said.