KUALA LUMPUR (Reuters) - General Electric Co (GE.N) expects to post slower revenue growth in Southeast Asia this year, underperforming the 30 percent of 2011 as economies in the region post more modest gains.
With China’s growth losing steam from its peak of more than 10 percent, GE is increasingly dependent on a strong performance in Southeast Asia.
“I think 30 percent growth is not sustainable in the long term as the economy in ASEAN is expected to grow softer at five to six percent, but we think we can grow at a double-digit rate over the next five years,” said Stuart Dean, chief executive of GE operations in the Association of South East Asian Nations (ASEAN).
ASEAN, which generated some $3 billion in revenue for GE in 2011, ranked as the fourth fastest-growing region for the conglomerate last year.
The maker of equipment ranging from electric turbines to water treatment machines sees Vietnam as its fastest growing country in ASEAN this year, underpinned by expansion in infrastructure, healthcare and transportation sectors, Dean told Reuters on Friday.
“But from a smaller base as compared with Indonesia and Malaysia,” he said at GE’s Malaysian corporate office. “And Thailand will bounce back in particular in the second half of this year as redevelopment gains momentum from the flood in 2011.”
GE is also set to record its first revenue from Myanmar this year, Dean said.
The conglomerate’s healthcare medical equipment unit appointed Myanmar’s Sea Lion Co. Ltd on Feb 25 as the national dealer for its products in the country.
“We will sell some healthcare equipment this year, but when and how the revenue gets significant in size, we don’t know yet,” said Dean.
GE has a direct presence in all ASEAN member countries except Brunei, Myanmar and Laos.
The conglomerate is not alone in focusing its attention outside the United States. U.S. diversified manufacturer Honeywell International Inc (HON.N) told investors on Wednesday that it expects sales in high-growth countries to rise to about $10 billion, or 25 percent of the forecast corporate total, by 2014.
Reporting By Yantoultra Ngui; Editing by Nick Macfie