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UK consultants quit Asian states

BRITISH CIVIL engineering consultants have staged a headlong retreat from the South East Asian market in the wake of the region's economic meltdown.

An analysis of the data provided for NCE's annual Consultants File reveals a dramatic fall in the number of British consultants working in the major Pacific Rim markets (see table).

However, there are growing signs that a stronger European market and opportunities in the US could provide some compensation.

In January 1998 54 UK firms were working in Malaysia, but by the beginning of this year the British presence had fallen to 36. In Hong Kong the number of firms declined from 50 to 40, in Indonesia from 42 to 26 and in China from 42 to 32. Markets in Thailand, South Korea, Singapore and Vietnam also saw a marked drop in activity.

The only South East Asian countries to retain their attractiveness were the Philippines and Taiwan. The Pacific Rim's economic crisis even affected markets on the Indian subcontinent, where there was a significant drop in UK firms employed on projects throughout India.

Some of the best known British consultants were involved in the retreat from South East Asia, which has been the sector's most important overseas market for the last two decades. The biggest casualities were in Indonesia where Hyder, Mouchel, Parkman and Knight Piesold all found their work had run dry.

Elsewhere in South East Asia it was mainly medium sized firms who failed to secure future work. Owen Williams, Tarmac Professional Services, WA Fairhurst and Buro Happold struggled in China; Thorburn Colquhoun and Dames & Moore found the going tough in Hong Kong; and Bullen, Gifford and Sandberg were the most notable absentees from Malaysia's depleted development programme.

Of the consultants still working in South East Asia, 25% saw their workload drop by more than a quarter during last year and a further 41% saw either no growth or a slight decline.

The outlook for the next two years is not much better, according to the firms which completed Consultants File questionnaires. Less than one in five is predicting growth of over 20% during 1999/2000. Most expect to stand still or grow by less than 10%. The only significant growth markets are perceived to be Hong Kong and China.

NCE's Consultants File is published on March 25.

alastairm@construct.emap.co.uk

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