In a post-pandemic economy, Asian businesses will think smaller and safer, with worrying implications for many workers
- Asia’s business leaders now start almost every discussion by talking about digital transformation
- Human labour is a business risk, given the possibility of a future outbreak. Factories may become more automated, with fewer workers
These are only a few of the changes since borders closed across the world and 60 per cent of global gross domestic product went into lockdown – changes that would be stunning at any other time.
It is becoming something of a cliché to say the post-Covid-19 economy will be a digital one – but it is nonetheless true. What has become clear through discussions with members of the Asia Business Council is how sweeping that transformation will be.
Members comprise some 70 chairmen and CEOs of leading companies in 17 economies throughout the region – not the tech unicorns, but for the most part the conglomerates that make up the bread and butter of the Asian economy, from private equity funds to pineapple producers.
They control companies valued at nearly US$3 trillion and directly employ about three million workers. They see fundamental, structural changes under way, ranging from a greater role for governments – and higher taxes – to much more rapid technological change. These business leaders now start almost every discussion by talking about the importance of digital transformation and automation.
Why East Asia is managing Covid-19 better than the West
Firms in China and South Korea were already global leaders in e-commerce and digital payments. Now even traditional firms in sectors like spirits are seizing opportunities to collaborate with tech giants and reach customers through smartphone apps. Tech giants like Alibaba are redoubling their courtship of the tens of millions of potential customers not yet online and in the digital economy.
Why Covid-19 won’t weaken China’s role in global supply chain
Asia may have the technology to play a leading part in the digital and automation revolutions, but it might not have the needed social safety net. In Europe, some governments have paid many of their workers to stay at home for weeks. Asia’s population cannot afford to stay in lockdown.
Citizens have had to make unprecedented sacrifices in the name of combating the pandemic and they deserve economic security, adequate health care, gender equality and more help for working families.
Global collaboration needs to be expanded too, to extend aid not only domestically but to neighbouring countries that are struggling with the pandemic. Businesses can help fill in the gaps where government aid falls short.
Colleen Howe is program associate at the Asia Business Council
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