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The winds of change are starting to blow through south-east Asia.

In the past, the differences between regional markets have been more important than the similarities, and the investment that has driven much of the region’s growth has come either from the west, or from east Asia – Japan, China and South Korea. But south-east Asian corporates – boosted by balance sheets that have survived the global financial crisis with little damage, and liberated by barriers to investment coming down – are now beginning to look within the region for new opportunities.

Hoang Anh Gia Lai is a Vietnamese furniture maker that has expanded to become the country’s largest property developer.

It is also involved in infrastructure projects – work started at the end of 2009 on two hydro-electric plants in the northern province of Thanh Hoa at a cost of roughly 500bn dong ($26m). The plants, to go online next year, will have a combined power-generation capacity of 140MW.

The group even finances player development – in partnership with the UK’s Arsenal – in one of Vietnam’s top-ranked football clubs, which bears its name.

Looking abroad, HAGL has branched into neighbouring Cambodia and Laos, where it has invested in rubber plantations, iron-ore deposits and hydroelectric plants.

“We think that, in the near future, all the countries in the region will open their economies and there will be more and more convergence,” says Vo Truong Son, deputy director-general at HAGL.

At the moment, flexibility is an asset. For example, HAGL bartered the building of the athletes’ village for last year’s Southeast Asian Games in Vientiane, the capital of Laos, for a large rubber concession in the country’s north-east.

Unlike Japan or South Korea, south-east Asia has produced few global brands. The region’s giant family-controlled corporations have mostly focused on domestic opportunities, in part because their local market supremacy has been bolstered by the kind of political protection that it would be hard to find in other countries.

But that model is under pressure from two directions: in an age of globalisation, formal protectionism (many of the region’s wealthiest corporations benefited from graft-ridden import-substitution policies) is becoming less and less acceptable, and the close personal ties between businessmen and politicians that characterised many south-east Asian economies have become less certain in a region undergoing rapid political change.

In spite of the changes, the Association of Southeast Asian Nations’ plan for a coherent economic community by 2015 looks unlikely.

“You are seeing more cross-border movement,” says Wellian Wiranto, a regional economist with HSBC in Singapore, though he adds that the regional economy is still deeply fragmented.

It is a trend that has been reinforced by the global financial downturn. Asian corporates, many of which had been badly stung in the regional financial crisis in the late 1990s, have maintained cash-heavy balance sheets and operate in domestic banking markets that are still awash with capital.

However, says Mr Wiranto, “I wouldn’t argue that it is a sign of economic integration quite yet. Most of it is driven by the need for scale.”

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