Aftercare is a core function by governments in promoting their locations to foreign investors. The three main types of aftercare are strategic, operational and administrative services.

Yet in Asia, the picture of aftercare is a mixed one. Most Asian governments concentrate on short- and medium-term aftercare, such as information and communications technology (ICT) staff recruitment support, equipment installation, product development and R&D capabilities. Nonetheless, due to the increasing complexity of ICT projects in Asia, support in the area of ICT capacity building is critical. This is particularly because much-needed ICT skills are in shortage.

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An example is China’s Investment Service Centres, which typically provide short- and medium-term aftercare. Although China's Five Year Plan highlighted new-generation IT as a strategic area of focus, the low level of English skills is a constraint in winning business contracts from the US and the EU. The country’s software industry also continues to remain at a primary stage where weak intellectual property protection is a hurdle for software providers.

Another example is South Korea, which is a highly connected country, with its broadband connections and mobile network being the fastest in the world. It is a significant market for the manufacturing of memory chips and smartphones, as well as ICT development. Yet aftercare support comes only in the form of investment ombudsman and an aftercare team, which provides business counselling.

Asian governments have traditionally focused less on long-term aftercare. Only a few governments provide long-term services to support firms in developing centres of excellence and boosting local R&D.

For example, Japan’s regional ICT cluster features ICT research parks and incubation centres across various prefectures such as Kanagawa, Kyoto and Fukuoka, to enable foreign ICT companies to boost their R&D operations. Furthermore, the Indian government has begun establishing ICT institutions such as its software technology parks, its International Institute of Information Technology, as well as its Electronic Hardware Technology Park. The upshot to this is that the top-tier Asian ICT markets will continue to dominate while the second-tier markets such as Malaysia and Singapore will have to aggressively play catch-up.

Lawrence Yeo is CEO and principal consultant of AsiaBIZ Strategy, a Singapore-based management consulting firm providing Asia market research, market entry and expansion strategy and export/FDI promotion services.