New Economic Reality: Transforming Uncertainty into Opportunity

Delivery

This report comes in PPT.

Key Takeaways

Inflation and economic slowdown affect consumer spending power and businesses’ bottom line

Slower economic growth and elevated inflation are expected to remain in the short and medium term, eroding consumer purchasing power and changing their behaviour, while making it challenging for businesses to retain their profit margins and find growth areas.

Energy pressures underline the importance of business strategy adjustment

Energy price and supply shocks have a ripple effect on business activities, costs and prices of end-products, as well as consumer behaviour. To mitigate the impact of energy market fluctuations, businesses are shifting to renewable energy and energy-efficient solutions, optimising energy consumption and overhauling their business strategies.

High interest rates and financial instability raise the cost of doing business

Higher cost of capital and tighter credit conditions are expected to prevail over the medium term, constraining consumers’ and business’ access to finance, with the construction, manufacturing and business services sectors being hit the hardest.

A reset of globalisation occurs as companies focus more on resilience

Geopolitics and global disruptions are reshaping global trade, resulting in fragmentation and volatility risks which challenge global business. Rather than a de-globalisation, a de-risking of global supply chains is taking place as companies attempt to make themselves more resilient to external shocks, while still seeking growth in international markets.

Labour market changes impact companies’ operation and productivity

Demographic shifts and global disruptions have contributed to a rise in labour shortages, skills mismatch and changes in worker preferences. Businesses will need to make both short- and long-term strategies on how to best navigate the challenging labour market.