Yeoh Siew Hoon reports from HICAP in Hong Kong where she heard Asia's top political risk analyst give his take on the region. The outlook: Clear skies, a few scattered thunderstorms but nothing too big to worry about.
If you've ever met Robert Broadfoot, the man who runs the Hong Kong-based Political Economic and Risk Consultancy (PERC), you would definitely not describe him as Mr Sunshine.
The man, who each year gives an Asian Risk Update to hotel investors and developers at the Hotel Investment Conference Asia/Pacific, is after all in the business of looking at the dark side of life – imagining worst case scenarios for businesses.
Thus, over the last two years, Broadfoot has not exactly been dishing out the good news to the hospitality investment community, given the bad news and crises that have afflicted the industry since 2001.
So much so that he's earned the nickname of Dr Doom and Gloom by delegates to HICAP.
This year, however, Broadfoot is a new man. In fact, the PERC man was even, dare I say it, perky when he gave his big picture look at the region at the HICAP event last week in Hong Kong.
Yes, it was mostly good news in his Asian Risk Update.
Here's where progress has been made, he said. Terrorist groups operating in the region have been weakened in their ability to carry out acts of violence; systems have become more responsive to crises such as SARS and chicken flu; people are more shock resistant; political reforms have taken place in certain countries that should promote economic and social stability; and Asia's financial infrastructure has been strengthened.
The only country where he expressed concern over was Thailand where he said he was "a little worried" about political issues. The consolation is tourism will be protected whatever happens because of its importance to the Thai economy.
While he said US, Japan and China have reached their peaks and growth may slow down next year, China will remain the main story, followed by India. "Some countries in South-east Asia could also start getting more attention."
Broadfoot said that the way Indian companies had succeeded in going global would give confidence to Chinese companies in their bid to expand. "India will redefine global competition."
And he repeated his prediction from last year that in a few years' time, there would be more Chinese and Indian hotel brands represented at HICAP.
It was therefore no surprise to see Christopher Bachran, CEO of Jinjiang Hotels, China, and Raymond Bickson, CEO of Taj Hotels, Resorts & Palaces, on the Asian Hotel Leaders Outlook panel. (More on that next week)
Other predictions by Broadfoot:
- The increased focus on intra-regional trade and investment will continue.
- China's outward push will continue and will mirror Japan's strategy in the 1980s – expect the buying up of channels and stakes in the airline and hotel businesses.
- A change in the status of the US as the world's sole superpower and how other countries will respond to it. Asians were finding it more difficult to get student visas in the US, and were finding educational opportunities within the region.
- Broadfoot however wouldn't be Broadfoot if he didn't throw in a couple of challenges for management.
- How to grow a business while being squeezed from both ends.
- The extremely price-sensitive nature of the Chinese market to everything from airlines to hotels.
- How to meet budget plans when major markets like China are likely to remain volatile.
And, saving the best for last, Broadfoot said things just weren't sustainable in the US economy with its fiscal account deficit. Something's got to give, he said.
My advice: Enjoy the great weather while you can and let's hope that next year, Broadfoot will be as perky as he was this year.The SHY Report
A regular column on news, trends and issues in the hospitality industry by one of Asia's most respected travel editors and commentators, Yeoh Siew Hoon.
Siew Hoon, who has covered the tourism industry in Asia/Pacific for the past 20 years, runs SHY Ventures Pte Ltd. Her company's mission is "Content, Communication, Connection". She is a writer, speaker, facilitator, trainer and events producer. She is also an author, having published "Around Asia In 1 Hr: Tales of Condoms, Chillies & Curries". Her motto is ‘free to do, and be'.
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