A new report from HSBC, ‘Navigator: Now, next and how for business’, surveyed 6,000 firms globally and found that three in five (61%) think governments are becoming more protective of their domestic economies.
This sentiment is strongest among companies in the Middle East and North Africa, where 70% of respondents thought protectionism was growing, followed by Asia-Pacific at 68%. In the USA, 61% believe protectionism is on the rise, while in Europe, half see a rise in protectionist tendencies.
The survey also found, however, that firms are focused on growth, with 77% of businesses reporting being optimistic about their international business prospects and expect the volume of trade to increase over the next 12 months.
Emerging economies were found to be significantly more optimistic (69%) than developed markets (53%), while Asia-Pacific, where both Guernsey and Jersey have developed strong links over the past decade, has the most positive outlook (82%).
Reasons given for 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%) in driving growth.
‘Overall, companies are showing remarkable agility in navigating the changing trade policy landscape,’ Mr Long said.
‘An increase in protectionist sentiment hasn’t hampered the optimism of firms globally, but is causing concern about the cost of doing cross-border trade and international business.
‘These findings should resonate with firms in the Channel Islands, given the ability we have here to work with internationally-dynamic firms to provide them with the secure, safe and expert cross-border services they are clearly looking for to help them grow.’
Mr Long said that there were particular opportunities for the islands to pick up market share in the bullish Asia Pacific and the Middle East markets by supporting cross-border activity such as China’s Belt and Road Initiative.
The emphasis the islands place on digital innovation will also be vital, Mr Long said, because as the HSBC survey showed, technology was a key driver behind international growth.
The HSBC Navigator combines an economic forecast from Oxford Economics of medium-to-long-term bilateral trade of goods and services across 25 markets, and a global survey by Kantar TNS gauging business sentiment on trade and business growth.
