How Asia’s corporations will rebound in a post-COVID-19 world

Jonathan Woetzel, McKinsey Global Institute Director, senior partner based in our Shanghai office and co-author of Future of Asia, reveals how technology enabled Asia's relatively swift and efficient response to COVID-19, while helping to preserve health and livelihoods in the region.

What are the biggest implications for Asian corporations in light of COVID-19?

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One out of every two dollars invested over the last decade went to Asian companies, leading them to be the single-largest segment of the Global 5,000, with over 43 percent of revenues. But revenues and investment did not necessarily mean profit. And with the appearance of COVID, what is the outlook for the Asian corporate sector?

Historically, Asia’s corporate sector has come through volatility. Whether it’s SARS and MERS or the Asian financial crisis, Asia’s corporates take a licking and keep on ticking largely through creative destruction, where over 60 percent of the top-performing Asian companies are new in that role.

Plus, there’s a massive upside. If Asian companies can improve performance to the level of their Western counterparts, over $440 billion of economic profit could be unlocked by reallocating capital across sectors and improvement in management performance. So, Asia’s corporates are in for a rough time. But don’t count out the Asian corporate sector—it’ll be back bigger and better than ever.

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