The 2013 Asia Business Outlook Survey is conducted by the Economist Corporate Network. It gathers input from over 200 senior executives who work for multinationals in Asia.

The latest survey reveals that most companies are no longer treating Asia as one business unit with a single regional headquarters based in one country. This is because of the growing size of its economy, not to mention the physical distances between countries. The area between Pakistan, Australia, and Japan now accounts for one-third of the global economy and it’s still growing fast. Some 45% of multinationals reported that they now have more than one regional headquarters in Asia. The most common countries to report directly to the global HQ were China, Japan, India, and Australia. It seems likely that this trend will continue.

It also seems that Singapore and Hong Kong are losing their attractiveness as places in which to locate regional headquarters because of soaring property costs, rising living costs, shortage of staff, and, in the case of Hong Kong, difficulty finding places at international schools.

The executives consider a good transportation and financial markets as critical for a regional headquarters, as well as the availability of local staff. Shanghai, Tokyo, and Kuala Lumpur were cited as possible alternative locations to Singapore and Hong Kong. One problem mentioned for KL was the difficulty in finding good local staff, although it was not the only city where this was a problem.

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