China has been the cornerstone for many businesses operating in Asia. Increasing labour and commodity costs however, are causing those businesses to rethink their growth plans incorporating a phenomenon known as the 'China plus one' strategy, by which firms seek to distribute their operations more widely in the Asian region, in addition to their presence in China.

While China and India continue to grab the headlines, many of those businesses are seeing a rapid increase in profit levels from elsewhere in Asia - in many cases outstripping returns in China. 15% of respondents expected revenue growth of over 25% annually from their operations in Southeast Asia, almost double the proportion of firms that boasted such rates during the previous three years.

That's one of the findings of a new report 'Rich pickings - opportunities in Southeast Asia's emerging markets' produced by leading global credit insurer Atradius in conjunction with the Economist Intelligence Unit. The report is based on a survey of businesses, most of whom have their headquarters in Europe and the US.

Another reason that businesses are looking towards the second tier of emerging markets is the current dearth of manufacturing capacity in India. A potent mix of Indian bureaucracy, politics and scarcity of facilities means that manufacturers are simply looking elsewhere to set up.

"Infrastructure problems aside, the Asian market holds huge opportunities for both western investors and exporters", says Tommie Sjodahl, Atradius' Chief Market Officer responsible for Asia. "With traditional markets shrinking, or at best stagnating, as a result of the global economic downturn, businesses are turning - indeed in many cases because they see no other opportunities - to the markets of Southeast Asia".