Kuala Lumpur - "ASEAN is not a single market." This assessment set the tone for a roundtable discussion on "Chinese Enterprises in ASEAN: Globalization Strategy and Localized Operation" at the 2026 Land-Sea Economic Forum in Kuala Lumpur, Malaysia.

As Chinese companies deepen their investments across Southeast Asia, the biggest challenge is no longer simply about costs or logistics. The key question is whether they can move beyond viewing the region as an extension of the Chinese market and embrace its diverse legal systems, cultures and business environments.

The roundtable panel at the 2026 Land-Sea Economic Forum brings together guests for an in-depth discussion. (Photo/WCICO)

The panel brought together four leading experts: Lee Heng Guie, Executive Director of the Socio-Economic Research Centre Malaysia; Iris Pan, Director of the Southeast Asia Development Center of Asia Pacific International Arbitration Chamber; Cheng Lu, Associate Professor at Sichuan International Studies University; and Nordin Abdullah, Founder of the Crisis Management Centre and Founding Chairman of the Malaysia Global Business Forum.

ASEAN is not another China

Unlike China's relatively integrated domestic market, ASEAN consists of multiple economies with different legal systems, regulatory environments and social contexts.

Lee pointed out that Chinese companies often view Southeast Asia as a natural extension of their home market and supply chains. The region is geographically close, infrastructure links are improving, and cultural familiarity can create a sense of simplicity.

But that familiarity can sometimes be misleading.

As he highlighted, ASEAN cannot be treated as a single entity. Each country has its own legal framework, political environment and business conditions, meaning that strategies cannot simply be copied from one market to another. He pointed to practical issues such as product standards and certification requirements. Companies need to ensure that their products, branding and operations fit local requirements before entering the market.

Lee Heng Guie, in the middle, speaking during the roundtable discussion. (Photo/WCICO)

Pan shifted the focus to internal management, observing that the challenge often begins inside companies themselves. Some Chinese business owners continue to rely heavily on experiences that worked in China, while failing to adjust to local working environments and expectations.

For Pan, localization is not simply about selling products in a new market. It requires companies to understand local partners, employees and operating practices before making investment decisions.

Iris Pan, third from left, sharing her views on Chinese enterprises' globalization strategies. (Photo/WCICO)

Compliance is not a cost, but a competitive advantage

While companies often view compliance as a burden, the speakers argued that the deeper issue is the mindset behind compliance.

Cheng Lu, from a legal perspective, said the biggest challenge is not simply understanding regulations, but changing how companies approach them. The bigger problem is that some companies still view compliance as an obstacle to overcome rather than a foundation for long-term growth. She argued that some companies still search for shortcuts when dealing with overseas compliance issues, but such approaches cannot support sustainable expansion.

"Attitude is the most important," Cheng stressed. Companies cannot expect networks or personal relationships to replace institutional understanding. Regulatory risks cannot be eliminated, but they can be better understood and managed through thorough pre-investment due diligence.

Cheng Lu, in the middle, sharing insights on compliance awareness and risk management. (Photo/WCICO)

Pan added that many investors focus heavily on commercial terms such as price, payment and delivery before signing contracts, while paying less attention to dispute-resolution mechanisms. Ignoring issues such as arbitration clauses can create serious problems when disagreements arise. For companies entering unfamiliar markets, legal preparation should not begin only after conflicts occur.

Reframing this financial burden, Nordin pointed out that compliance costs are rising universally, whether in Asia, Australia, or Western markets. Rather than treating compliance as a passive drain on profits, Nordin urged business leaders to view it as a strategic differentiator.

While acknowledging that a true compliance culture is still lacking globally, Nordin also noted that building a stronger compliance culture remains a global challenge. Building stronger internal governance can help companies manage uncertainty and differentiate themselves in increasingly regulated markets.

Nordin Abdullah, speaking about the importance of building a stronger compliance culture for global business operations. (Photo/WCICO)

From selling products to co-building ecosystems

As Chinese companies expand in ASEAN, questions have also emerged about how foreign investment can create value for local economies. Panelists agreed that sustainable localization requires transitioning from transactional penetration to co-building an inclusive regional ecosystem.

Lee emphasized that host countries welcome foreign investment, but expect long-term commitment and mutual benefit. Rather than sourcing all supplies, labor, and technology exclusively from China, investors should integrate into local supply chains, cultivate local suppliers, transfer technology, and train regional talent.

Nordin added that successful overseas operations require companies to ensure that employees, partners and other stakeholders feel aligned with the business. For him, localization is not only about establishing operations in a new market, but also about creating relationships that allow companies to operate sustainably within the local environment.

Overall, the discussion showed that ASEAN expansion is no longer only about market access. The deeper challenge is whether companies can transform from foreign entrants into long-term participants in local economies.

For Chinese companies, the next stage of globalization may depend less on how quickly they enter new markets, and more on how deeply they become part of them.