June 2010
Australia - Construction receives budget boost

The building and construction industry received a major shot in the arm from the state budget, with more than A$8.6 billion (US$7.2 billion) allocated for the construction of major infrastructure in Western Australia. The state government committed A$7.6 billion (US$6.4 billion) for the construction of general infrastructure projects, with over A$1 billion (US$800 million) allocated to construction works at schools.

In total, A$170 million (US$143 million) of the state’s infrastructure spending will be allocated to landmark projects in the metropolitan area. The Perth Waterfront redevelopment was allocated A$21.5 million (US$18 million) over four years for detailed planning and design, with construction of the mixed-use portion of the development due to commence in 2012.

June 2010
Booming Asia smart phone market ringing with opportunities

Key global players such as Research in Motion and Apple have enjoyed growing success in penetrating the Asian smart phone market. Smart phone shipments are expected to more than quadruple, with Asia accounting for 39% of the global smart phone shipments, by 2015. The expansion of 3G networks in large Asian markets such as China and India coupled with greater accessibility to smart phones as they cease to be luxury items with lower retail prices from economies of scale, are both contributing factors to the growth in Asia's smart phone market.

While this growth offers an attractive opportunity, it also creates challenges for many traditional players in the smart phone space. There is increasing competition from Asian handset vendors like Huawei, ZTE, HTC, and Acer in the Asian smart phone market. In addition, the grey market for mobile handsets is much more rampant in Asia than in western markets, giving consumers viable alternatives to more conventional handset purchasing methods. However, these challenges to the estabished players are opening up a booming smart phone market to players who have had trouble competing with entrenched competitors in developed western markets.

June 2010
Vietnam - Livestock industry needs facelift

As Vietnam's population would rise from 86 million to 126 million by 2050, demand for pork and poultry was projected to rise from 2.3 million to 3.4 million tons and 415,000 to 610,000 tons respectively. To meet the increasing demand, Vietnam must enhance livestock production by encouraging investment in industrial poultry production.

However, endemic diseases and the high price of animal feed had hampered the sector's development. Hence, the country to strengthen movement control and quarantine to reduce the risks of infection and spread of disease. Upgrading basic hygiene practices, strengthening veterinary and financial services, improving feed supply and hatchery management were among things the sector should do. In addition, local authorities must adopt measures to balance the sector development with environment issues.

June 2010
China - Tea industry needs to overcome challenges to fulfil potential

According to a report by Himfr.com, the Chinese tea consumption market has great potential, but there exists an intensive cultivation lull, with tea processing enterprises and small-scale development bottlenecked, while also facing new technology developments and application challenges. Tea plantation areas in China in 2009 reached more than 2,700 acres, which ranked as the world leading position. 

However, the average export price of tea in China is only about US$2 per kilogram, about half of that charged by India, Sri Lanka and other countries. Experts believe China's domestic tea producers needs to improve tea quality, safety and health benefits, to develop the vast domestic market, if the Chinese tea market is to reach its true potential.

June 2010
Indonesia - Cost of production in food and beverage industry to increase

The cost of production of small and medium enterprises (SMEs) in the Indonesian food and beverage sector is estimated to increase 30%-50% starting in mid 2010. According to Secretary General of the Indonesian Food and Beverage Businesses Association (Gapmmi) Franky Sibarani, the cost of production hike was attributable to the government's plan to raise electricity tariffs by an average of 10% in mid-2010.

The electricity tariff hikes would make electricity represent 20% of SMEs' cost of production, rising from the previous 6.3%. Nevertheless, the food and beverage product sales value in 2010 could reach more than Rp600 trillion (US$66.1 billion), thanks to favourable economic conditions, rising from Rp500 trillion (US$55.1 billion) in 2009.

June 2010
Immense potential in Indonesia's mass grocery retail sector

With its vast size and the currently low levels of penetration, Indonesia has emerged as one of the rapidly growing food and drinks industry in the South East Asia. Various factors, such as economic growth, increasing urbanization, young affluent population, and numerous regional food health and safety concerns have led to a surge in the industry. Increasing health awareness and safety concerns among Indonesian consumers have further propelled the segment. Considering the growth potential, numerous domestic and international players have set up their facilities in a move to penetrate the flourishing market. 

Notably, mass grocery retail (MGR) has very strong long-term potential in Indonesia. As the Indonesian economy has developed, so has demand for MGR. Delhaize, a Belgium-based international MGR operator, recently announced plans to triple its expansion efforts in Indonesia. While the retailer experienced solid growth in its home market, it was emerging markets that really helped boost results, with year-on-year revenue growth of 15.5% in Indonesia. French retailer Carrefour has also been expanding rapidly through its local subsidiary and is now the leading foreign MGR operator in the country. Indonesia's MGR sector is forecast to rise 57.7% in sales to US$10.44 billion by 2014.