As one door opens, another closes – as the saying goes. As the United Kingdom begins to settle after the changes brought on by Brexit, it is clear that many traditional avenues of export – and by extension business growth – have been closed off.
Conversely, the changes have forced the hand of many organisations, and provided a catalyst for positive change. Many have been driven to finding new markets – or at least to re-evaluate those in which they are already active but may not have considered a priority. Goods and services trade with EU partners is declining, but other regions are now rising to fill the breach.
One of the top destination markets is APAC
Statistics point towards the Asia-Pacific region as one of increased energy and interest for British businesses. Nearly 16 percent of the UK’s non-ferrous metals come from Australia, close to five percent of the region’s meat and related products from New Zealand, and nearly a billion pounds worth of vehicle imports annually come from Japan.
The UK and Singapore have moved together towards a digital future, with trade agreements and well over three billion pounds worth of services and content delivered digitally from the UK to Singapore each year, from e-books and streaming platforms through to financial and legal services.
International Trade Secretary, Liz Truss said: “A cutting-edge deal with Singapore will keep us at the forefront of the technological revolution, ensuring we lead the way in digitally delivered trade and industries like fintech and cybersecurity. We are already the second largest services exporter in the world, with a huge comparative advantage in this area that we intend to capitalise on.”
With a noted shift in trade relations between major partners such as Australia and China, there is also talk of expanded trade between Australian companies and Japan, Singapore and India – in fact, an expanded region that is increasingly referred to as Indo-Pacific, rather than the smaller Asia-Pacific definition.
Finding great talent remains a pressing issue
Coupled to this shift in export market priorities is the global challenge presented by talent shortages. While companies from the UK, Australia, Singapore and others look to expand their business and find new markets in new jurisdictions, the lack of available talent to fulfil technical, services and analytics roles (among others) is a serious handbrake on growth and success.
In fact, Australian Prime Minister Scott Morrison labelled the country’s talent shortages as the single biggest challenge to economic growth over the next decade, during his budget speech for 2021.
He has since stated that: “Workforce, I believe, is the biggest single challenge facing the Australian economy. You will hear me talk about it until you’re sick of hearing me say it, about the importance of building the skills our workforce needs.”
The situation in Singapore is similar, with Ravi Menon, the managing director of the Monetary Authority of Singapore (MAS), stating that of 25,000 technology workers in the local financial sector there are around one-third local Singaporeans. 6500 new roles were created in the first half of 2021 alone. Menon goes on to reference a “large mismatch between supply and demand” in the tech sector.
With a potential influx of interest in the region resulting from the Brexit situation, these disparities are only going to increase.
The situation will need a partial reinvention of traditional hiring and expansion methods, or there simply will not be enough appropriately skilled people to perform essential services, and harness the economic growth on offer from the UK.
What should the APAC region be doing about this?
The Asia-Pacific region must look to new ways of expansion and export, that perhaps do not require the organisation to set up an entity in a new jurisdiction in order to create a sales presence and conduct business there.
Further to that, the mentality requiring hired talent to be based in the ‘home’ city or place of business, and have employees turn up to corporate offices each day, needs to evolve.
Business models now exist that assume the role of the hirer and employ staff to their own payrolls with all legalities, tax, insurance, awards and compliance taken care of. This therefore allow a company to onboard staff in a matter of hours, and significantly reduces risk.
At Globalization Partners, we have seen the world pivot rapidly to embrace what was at first a shift to Work-from-Home conditions, then again towards a broader acceptance of remote work. It is simply not necessary in the modern digital world to expect all employees to co-exist in the same building five days a week – nor even to reside in the same country.
A recent survey conducted by our organisation revealed that two thirds (63 percent) of respondents expect their companies to make remote work a permanent fixture following the global pandemic.
For the Asia-Pacific region to fully capitalise on renewed opportunities coming out of the United Kingdom as a result of Brexit, and the subsequent shift in economic forces – it is vitally important that the right playing pieces are available across the board, no matter where that opportunity happens to strike.
Therefore, a modern growth mentality must not rely on available talent in a specific city, state or country – but must open itself to borderless talent, and find acceptance for hiring it wherever those opportunities lie.
With the right focus on ubiquitous growth and an understanding of the fluidity that exists in the modern talent pool, Brexit may well signal a new wave of growth for the United Kingdom and its trading partners in the Asia-Pacific region. So yes – as one door closes, another opens – and paradoxically, a shrinking market on the one hand may lead to evolution and growth on the other.