There are many theories about this, but we thought the following three are the key reasons: 

Geographical proximity

Most major cities in Southeast Asia are located in the same or adjacent time zones as China, enabling timely collaboration with partners and subsidiaries.  It generally takes less than a week on the sea to ship goods from China to major ports in Southeast Asia. Industrial parks in Northern Vietnam are  only 11-12 hours drive from the Pearl Delta. 

Historical and cultural similarity

The Chinese have been trading with Southeast Asia for centuries. Southeast Asia is home to more than 35 million of ethnic China. Most major commercial hubs in Southeast Asia boast a vibrant Chinese business community. Chinese language adoption is good locally and the existence of dedicated interest groups/ commerce chambers  facilitates smooth cross-border transacting.

Developmental proximity 

While the levels of economic development vary across Southeast Asia, it is generally agreed that in terms of tech, Southeast Asia mimics the development pattern in China a few years back. Same can be said about the region’s consumption level and consumer patterns.

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at hello@mworks.asia.