Internet usage has grown rapidly in many ASEAN countries

Don’t underestimate the ASEAN consumer. Yes, there are only about half as many of them as there are in China or India. And the typical shopper in the 10-member Association of South East Asian Nations is not as wealthy as those in Europe.

But ASEAN’s 620 million-plus inhabitants are an increasingly powerful source of global demand, and a potential game-changer for companies that are looking for growth in a tough and uncertain global environment.

ASEAN has come a long way in a short time. Spanning countries as diverse as Singapore, Vietnam and the Philippines, the region has gone from being primarily a hub for manufacturing cars, electronics and other goods to being a market for those very goods.

China’s Belt and Road initiative is expected to inject political momentum and financing into many projects in the coming years

Visit the airports in Bangkok, Manila and Jakarta, and you’ll find them bustling with Malaysians, Indonesians, Thais and Filipinos who just a decade or two ago could not have dreamed of enjoying an international holiday.

ASEAN is not an easy market to tap, however. It spans a wide array of religions, cultures and languages, multiple political systems, and varying levels of economic development. GDP per capita in Singapore, for example, is roughly 50 times that of Cambodia, and 16 times that of Indonesia. Internet penetration in Singapore is excellent; in Myanmar, it is almost non-existent. A one-size-fits-all business approach is not a recipe for success.

At the same time, the region is sprawling and physically disjointed. Infrastructure links in many parts of Southeast Asia remain underdeveloped or overloaded. All this means that ASEAN’s enormous potential – and consumption power – is often still not fully appreciated.

A number of factors support ASEAN’s growth prospects. Infrastructure links are improving. China’s Belt and Road initiative is expected to inject political momentum and financing into many projects in the coming years.

The recently-formed ASEAN Economic Community (AEC) is gradually liberalising the flow of goods, services and capital, smoothing cross-border activities for companies doing business within this dynamic region. Full implementation of the liberalisation reforms envisaged under the AEC could lift regional GDP by 5 per cent by 2030, according to HSBC estimates.

ASEAN consumers are growing in numbers, but also becoming more urbanised and better connected. Increasing internet connectivity is making it possible for large swathes of Southeast Asia’s population to access goods and services that were once beyond their financial and physical grasp.

Take financial services. The World Bank estimates that about two-thirds of people in Indonesia, the Philippines and Vietnam, and about one in five of those in Malaysia and Thailand, currently have no banking relationships. Improving internet connectivity and the introduction of digital banking technologies will allow tens of millions of people to access savings, loans, investment and insurance services for the first time.

ASEAN is not an easy market. But its consumers represent a rare bright spot in the global economy – and a prize worth going for.

A version of this article first appeared in the FT’s Beyondbrics on 29 July 2016.