Senior-level financial and treasury professionals in Asia maintain an overall high level of optimism, according to the findings of “Treasury Verdict,” a live poll session of attendees at the EuroFinance 2012 conference in Singapore.
Over two-thirds (67 percent) of respondents indicated that they are optimistic about their companies’ performance over the next 12 months, as opposed to just 25 percent who are uncertain and eight percent who are pessimistic.
This is a stronger showing than many of their counterparts who voted at other EuroFinance events, including China (52 percent optimistic), Turkey (66 percent) and Europe (50 percent), but more negative than Brazil (85 percent), Mexico (82 percent) and the Middle East (73 percent).
This optimism on the region is further reflected by the professionals’ response to which areas are most important to their global growth. 70 percent chose Asia, while 60 percent selected China. The rest of the globe follows at considerable distance, led by the Middle East/Africa (19 percent), Latin America (18 percent), North America (10 percent) and Europe (9 percent).
Myanmar emerged as the most popular single frontier economy in Asia with 25 percent of the vote, outstripping Cambodia and Laos which had 10 and 3 percent respectively. An overwhelming 62 percent chose ‘other,’ without an indication as to which country in particular.
Worries on a China slowdown seem to be relatively low. 45 percent anticipate that they are “not very” worried about a relative slowdown in China affecting Asia, while 40 percent do not even anticipate a slowdown.
Only 15 percent are “very worried” about the potential effects. The euro crisis’ effects, however, still reverberate through the region, with 48 percent indicating some impact on their business, 17 percent saying “not yet, but I expect it to,” and 13 percent being considerably impacted. 22 percent said there was no sign of any effects.
The renminbi remains a key story for many finance and treasury professionals. Almost half (49 percent) expect to see a fully convertible renminbi within five to 10 years, though 23 percent believe it will take over a decade. 18 percent expect it in less than five years. 10 percent of the audience, however, believes it will never be fully convertible.
The audience was similarly divided between those who currently or are expecting to receive invoices in the renminbi. 31 percent are already receiving renminbi invoices from Chinese suppliers and 20 percent are expecting to, but 49 percent of the audience indicates that they do not.
Companies in Asia also remain mostly bullish on refinancing risk, with 74 percent saying they are not facing such risk. 14 percent expect it to crop up in the future, while 12 percent are already dealing with it.
Banks are also the key solution to protecting the company supply chain – over half of respondents (53 percent) said that working with banks to provide finance was their best option to protect the supply chain, followed by offering better payment terms (37 percent) and squeezing the supply chain (30 percent).