ASEAN KEY DESTINATIONS
Electrifying the ASEAN countries
With more than 300,000 employees across 170 countries and close to $150 billion in revenue last year, General Electric is one of the worlds largest companies. The US multinational, which entered Cambodia in 2007, has over 100 years of experience in the region developing technology solutions ranging from power plant infrastructure to jet engines and household products. The Post’s Daniel de Carteret sat down with John Rice, vice chairman of GE and president and CEO of GE Global Growth and Operations, during a visit to Cambodia this month, to talk about the firm’s ASEAN expansion and plans for the future.
What are some of the things that GE is currently working on in Cambodia and where are the opportunities to expand?
The rice husk project is one. By the end of the year we expect to get that up and running. There are two things; biofuels and the second is distributor power, so smaller power block sizes can be used to get to people who today don’t have power transmission and distribution infrastructure. Much of the population does not have that infrastructure, like the wires, so you look to solve that problem on top of the power generation.
In health care, we have started our foundation with capacity building. You have lots of equipment in countries, including Cambodia, that has been purchased or provided – by an NGO for example – and you have to have people to maintain it. We have trained 30 biomedical technicians, so we can keep stuff running. And it is not restricted to our equipment, because at some point, hopefully, someone will want to buy more GE equipment, so it is not purely philanthropic.
How does GE’s transition from a global company to a provider in local markets play out with ASEAN integration?
We think it fits hand in glove, because what we want in all of this is a level playing field. Our goal is not to anticipate the next source of geopolitical strife; we go where there is a demand for infrastructure, where people need the kind of stuff that we have. We go where there are natural resources and market size and population. We believe that any country that needs infrastructure, we should be part of. If you look at what we do in ASEAN today, we have 7,500 employees, and two-thirds of what we do in ASEAN countries gets exported to another country. The simple way to think about that is that it only exists because the barriers are low enough to facilitate that trade. If barriers go down further, we will hire more people; we will expand what we do here.
There are few Cambodian companies with a large international presence – most are very small, which in some markets can create nervousness towards opening up to competition. With ASEAN integration approaching, how does the market ensure a rising tide lifts all boats?
You have to have some people or some companies that create some winners. Because the issue ends up being, when you lower barriers, from a macro-perspective, things should get better. You should create more economic growth and that should be a good thing. The tide should rise and carry a lot of boats with it. But the problem is that there is always a dislocation, so nobody wants to deal with the friction created by the dislocation – you either ignore it if you’re a politician at your peril or you have to retrain, and that is hard work – to convince people that used to be in farming that there is a better way to make a living, which is hard.
I think you have to have a way to short-circuit, if you will, the dislocation and create some winners. You have to have some people, some investors, maybe some companies that take a long-term view. I think that is part of it.
Corruption and red tape is always talked about when doing business in Cambodia. How much of a threat is this to potential investment?
It will deter some investors; I think it can have an impact in terms of the overall level of economic growth. The other thing I would say is, Cambodia hasn’t cornered the market on corruption. We believe, and I think our reputation helps us, that you can do business here the right way and so we don’t think we have to compromise in any way to do business here. We wouldn’t compromise in any way. For us, the effort to do what we do and to do it here is worth it. But there is no question that corruption matters and everybody has fix it in their own way. There isn’t any one size fits all to cleaning up corruption around the world.
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