According to the report, cultural issues and conflicts, as well regulatory hurdles, are the main obstacles to cross-border M&As.

"The company should have a clear idea about their future business and then decide on the M&A strategy accordingly," said Lyn, who noted that a key challenge is human resources.

Yang Yuanqing, chairman of Lenovo Group, shared that viewpoint. "We have to face the challenge of human resources. We need talent from abroad."

The report shows that nine out of 10 CEOs in the Asia-Pacific region are upbeat about revenue growth in the next 12 months.

Confidence about prospects for revenue growth has reached a record level nearly twice as many global CEOs surveyed feel "very confident" about revenue growth over the next 12 months compared to five years ago.

Optimism aside, business leaders in the Asia-Pacific region are more wary of non-business risks. Nearly two-thirds said they were concerned about possible pandemics, a growing scarcity of natural resources, terrorism and global climate changes.

When surveyed about factors in their expansion plans in the 12 months ahead, Asia-Pacific CEOs pointed to new markets through geographic expansion (26 percent); better penetration of existing markets (23 percent); new product development (14 percent); and M&As often across borders (13 percent) .

In identifying their company's competitive advantages, the three most cited factors by CEOs on the mainland and in Hong Kong are outsourcing of both manufacturing and logistics and owning the company's entire value chain.

(China Daily 02/07/2007 page14) 

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