Business executives in South-east Asia are optimistic about growth prospects in the region, a survey by market research provider Euromonitor International released yesterday showed.
But skills shortages in the workforce and changing regulations were identified as challenges.
The survey of more than 100 senior leaders, who are C-level executives, owners, founders, directors and senior managers from both the private and public sectors, showed that 46.3 per cent of respondents believed their sector would grow between 6 per cent and 10 per cent this year.
Another 30 per cent were looking at growth of between 11 per cent and 40 per cent.
The report, the first edition of the South-east Asia Business Leaders Report, also revealed that an overwhelming number of respondents, or 83.1 per cent, felt that growth would come mostly from innovation in new products and services.
The importance of digital transformation - defined as the implementation of a digital strategy bringing people, data and processes together - was highlighted by the fact that the forecast for the percentage of the population in South-east Asia with access to the Internet daily would rise from 18.3 per cent in 2014 to 60.8 per cent in 2024.
"Digital transformation is a costly affair, requiring organisational changes alongside the re-alignment of business priorities and transforming the skillset of the workforce," said Ms Yvonne Kok, head of passport research at Euromonitor International. "However, the opportunities offered by digitalisation will be the catalyst behind the attitude shift in the South-east Asian markets."
The report also identified how companies were lacking data access, with 41 per cent of respondents identifying this as a weakness. One of the contributing factors was the lack of a skilled workforce to accelerate digital adoption.
Not surprisingly, then, 74.2 per cent of respondents recognised skills shortages in the region as the top challenge.
The report said that statistics revealed a talent gap between South-east Asia and the rest of the world, as only 9.5 per cent of the population aged above 15 had higher education, compared with 13.7 per cent in Latin America and 35.8 per cent in North America. Singapore is the anomaly in the region, with almost 23 per cent.
However, despite this, Euromonitor pointed out that the Republic ranked only No. 20 last year when it came to skills matching, based on the Global Competitiveness Index.
The report also said that there were concerns about the environment of changing regulations and legislation in the region that is beyond the immediate control of the companies, and about the wider political landscape that has proved volatile at times.
The Euromonitor survey was carried out between last October and February this year.
