Briefs

Greta Thunberg brought a stark message to the business elite gathering in Davos: Everybody is talking about climate change, but nobody is doing anything.

Her appearance at the opening of the World Economic Forum was a striking sign that the debate about how to stop the Earth warming has become mainstream in business circles. Yet only a handful of executives from the oil, gas and coal industries that are chiefly responsible for warming the planet were seen attending the panel at which Thunberg spoke on Jan 21.

Meanwhile, US President Donald Trump used his speech at the event to tout the benefits of soaring American oil and gas production and make a thinly veiled attack on those who warn about looming environmental catastrophe.

“The climate and environment is a hot topic right now, thanks to young people pushing,” 17-year-old Thunberg said at the Swiss ski resort, where about 3,000 business and political leaders gather each year. “Pretty much nothing has been done, since the global emissions of CO2 have not reduced.”

The Swedish activist’s words came as the World Economic Forum sounds alarm bells on climate change. This year, for the first time on record, environmental risks occupy the group’s top five long-term concerns, while corporate executives say they’re increasingly concerned about environmental issues. But young activists at Davos said none of this is enough.

Thunberg is giving relevance to the Davos gathering, which for years has suffered from criticism that it was largely a billionaires’ playground where the rich debated among themselves without hearing outside voices.

The debate on climate change is forcing businesses to respond to demands to stop carbon dioxide and other greenhouse gas emissions. While some have been slow in embracing the fight, executives at Davos highlighted that the overall views from within the business community have dramatically changed over the last decade or so, moving from denial and questioning science into complete acceptance. – Bloomberg LP

More than half of CEOs see global growth slowing this year

The proportion of chief executive officers expecting global growth to slow in the coming year has risen 10-fold since 2018, according to a survey conducted by PricewaterhouseCoopers.

That means that over half of the 1,581 CEOs questioned in 83 countries see the pace of expansion slowing, the most since PwC began asking the question in 2012. In every region, executives reported increased pessimism, and confidence in their own company’s revenue growth prospects – both in the short- and medium-term – fell to the lowest since 2009.

The biggest concerns are over-regulation, trade conflicts and uncertain economic growth is rising, the report said.

The PwC survey, which was conducted from September to October 2019, is being launched as the World Economic Forum kicks off in Davos, Switzerland, on Jan 20. WEF President Borge Brende the week before echoed its tone, warning a press conference in London that “we are faced with a synchronized slowdown in the global economy. And we’re also faced with a situation where the ammunition that we have to fight a potential global recession is more limited.” – Bloomberg LP

Singapore leaps up rankings in Bloomberg’s innovation index

Singapore leaped three spots to reclaim its No. 3 rank in the 2020 Bloomberg Innovation Index, while economies across Asia Pacific showed a mixed picture of progress.

After a six-year streak at the top, South Korea was unseated from its best-in-world spot by Germany – but only just. Japan and New Zealand were among those losing ground in innovation against global peers, while Vietnam showed a big gain.

Singapore’s rise against global peers was underpinned by stronger showings in productivity and patent activity, while the city state also retained a world-beating ranking in tertiary efficiency. For the latter category, Bloomberg’s rankings take into account factors such as graduation rates of first-degree earners and the share of the labour force that’s made up of new science and engineering graduates.

Singapore’s high standing in the index speaks to its long-term focus on adapting to an aging population, as well as a tighter labour market that’s allowed for productivity gains, said David Mann, chief economist for Standard Chartered in Singapore.

“You can’t just try for a little while,” he said of policy makers struggling to innovate their economies. And for Singapore, “we see more in the pipeline with even more use of automation in multiple industries. There’s a lot that’s on the way in that regard – and being willing to experiment” in industries including finance, he said.

The annual Bloomberg Innovation Index, in its eighth year, analyses dozens of criteria using seven metrics, including research and development spending, manufacturing capability and concentration of high-tech public companies. – Bloomberg LP

Asean stands to gain from phase one trade deal: AMRO

The Asean +3 Macroeconomic Research Office (AMRO) has upgraded its 2020 growth forecast for the 10 Asean nations as well as Japan, China and Korea by 0.2 percentage points to 4.9%, just a month after its previous prediction of 4.7%.

The macroeconomic watchdog says the upgrade comes on the back of the signing of the phase one trade deal between the US and China after nearly two years of trade tensions.

The way AMRO’s chief economist Khor Hoe Ee sees it, the phase one deal was positive move – “without which you would have had the tariffs on Dec 15”. Such a situation would have further shaken the global economy through higher costs of both intermediate and final exports from both superpowers.

Further, Khor adds that the global economy will also benefit from the reduction of tariffs imposed in October by half under the phase one deal.

In the interim, the Asean +3 countries stand to gain from trade diversions, says Khor. To this end, he highlights Vietnam and Malaysia as two countries that are in prime positions to attract more investments and trading activity.

To fully reap these benefits, he advises a mixture of structural, macroprudential, fiscal and monetary policies to prevent financial imbalances and enhance growth.

For now, Khor says the oft talked about phase two of the deal would be difficult, especially for China.

Already, China has a slew of issues to implement, such as lowering non-trade barriers on agricultural products, penalising trade secret theft and prohibiting the forced disclosure of technology from US firms, he says.

This will cause China “difficulty in delivering” if further requirements are imposed, Khor points out.

To this end, he does not envision further tariffs or talks on the trade war – at least until after the US presidential election that is scheduled for Nov 3.

“Our view is that we should be cautiously optimistic because the election and phase one provide breathing space for everyone, so take advantage of this time to consolidate, do structure reforms and build capacity,” Khor says. – By Amala Balakrishner

DBS launches QR code-based B2B payments and collections solution

DBS Bank has launched a QR code-based solution to help food and beverage (F&B) operators with the largely cash and paper-based payments and collections with their suppliers and vendors.

SG5, a wholesale distributor of beer and stout, which was one of the first to pilot the business-to-business (B2B) payments and collections solution, expects to save up to 3,300 manhours a month from this initiative.

“On average, our frontline staff spend around 3.5 hours every day traveling to different parts of the island to collect cash and cheque payments,” says Alvin Chua, CEO of SG5.

SG5 is the main distributor for Asia Pacific Breweries Singapore – whose main brands include Tiger Beer, Heineken, and Guinness – to about 5,600 F&B retailers, including coffee shops, hawker centres and restaurants.

Developed after close to 20 digital workshops with F&B operators to map their payments journey and pain points, DBS’ B2B payments and collections solution facilitates cashless and faster F&B payments.

The end-to-end platform, which is powered by DBS RAPID and DBS MAX, enables instant payments with automated accounts reconciliation functionalities in the backend.

It also allows customers to consolidate multiple invoices into one QR-code based transaction. Customers will have the flexibility to make full or partial payments for one or multiple invoices.

In turn, suppliers now have the option of enhancing credit terms for each invoice instantly. Suppliers can also send a QR code requesting for payment to their customers who are not on-hand to receive the goods in-person.

“Many SMEs we speak to want to realise productivity gains by becoming more digital but they don’t have the expertise or infrastructure to do so. By understanding their pain points and then laying the foundation for enhanced payments capabilities one sector at a time, DBS aims to lead the way in digitalising and streamlining the payments landscape in Singapore,” says Joyce Tee, DBS’ group head of SME Banking.

“Our aim is to enable our SMEs’ timestrapped workforce to be able to spend more time serving their customers and exploring new business opportunities,” she says, adding that digitalising payments for F&B players is the first step in transforming the cash-intensive B2B payments and collections landscape. The bank says this also supports Singapore’s aim of enhancing productivity by eliminating cheques by 2025 and going cashless. – By Stanislaus Jude Chan