22 November 2018

Firms around the world are navigating uncertainty with optimism

Watch Noel Quinn talk about some of the Navigator findings and how HSBC can help you unlock future opportunities for your business.

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Firms hopeful despite protectionism fears

 

We have insight from 23 markets around the world – here are some of the global findings from over 6,000 businesses like yours. Can you relate? Join in the conversation at #HSBCNavigator . For knowledge about what is happening in your market or that of your competitors, suppliers or buyers – have a look at the range of reports we have here.

Protectionism on the rise – impacts business operational costs and availability of skills

  • 61% of firms globally think governments are becoming protective of their domestic economies.
  • This sentiment is strongest among companies in MENA (70%), and Asia-Pacific (68%).
  • In the USA, 61% have seen an increase in protectionism, while in Europe, less than half are seeing a rise in protectionist tendencies.
  • As a result, two in five firms (40%) globally report an increase in the costs of doing international business. A shortage in the availability of skills and labour (28%), and the need to establish joint ventures or local subsidiaries (28%) are the next largest impacts identified by companies.

Firms have bullish outlook for short-term growth and cross-border business

  • 77% businesses are optimistic about their international business prospects, and expect the volume of trade to increase over the next 12 months.
  • Companies in Asia-Pacific have the most positive outlook (82%).
  • Reasons behind this confidence include an increase in demand for their products from consumers and businesses (33%), favourable economic conditions (31%) and the greater use of technology (22%).
  • 61% of companies globally are also positive about the specific growth outlook for their trade in services. Emerging economies are significantly more optimistic (69%) than developed markets (53%).

Increased regional trade emerges as key business strategy to overcome uncertainty over global trade policy

  • 74% of cross-border trade in Europe and Asia-Pacific is being conducted in the region.
  • This trend is set to continue with regional ties being prioritised in firms’ expansion plans for the next three to five years.
  • Regional initiatives such as China’s BRI (40%) and ASEAN’s 2025 strategy (37%) were cited most frequently as having a positive impact on international business.
  • 28% of firms say they are looking at establishing joint ventures or local subsidiaries to overcome protectionism.

HSBC Navigator is the most comprehensive report of global trade and business confidence. It combines an economic forecast of medium to long-term bilateral trade for exports/imports of goods and services across 26 markets (by Oxford Economics), and a global survey of over 6,000 businesses by Kantar TNS over Dec 2016 – January 2017.

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