Businesses worldwide are looking to map out strategies for economic recovery following the COVID-19 pandemic.
The task may appear difficult for many businesses. However, a recent report released by Western Union Business Solutions, in conjunction with Oxford Economics, reveals a huge sector projected for enormous growth over the next five years through the Global Services Trade Revolution (GSTR) report.
The digital services market is one that has grown organically over the past 20 years. However, due to COVID-19, the sector’s importance has been amplified, opening the doors for significant growth.
SmartCompany spoke to Sam Fitzpatrick, Regional Vice President – Head of Asia Pacific at Western Union Business Solutions to explore the reasons for this projected growth.
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Trillions of dollars amassed for business recovery
One of the most important and exciting aspects of the GSTR report Fitzpatrick identifies is how businesses can potentially capitalise on the under-appreciated nature of trade in global services.
Western Union’s analysis suggests that while the COVID-19 pandemic has shaken the global economy, trade in modern digital services has proven comparatively resilient through the current crisis. Trade in services has typically been undervalued, when compared to trade in goods or manufacturing, however, accounts for over half of all global trade.
“When you narrow the lens to Australia, we’re projected to increase global services exports by US$45 billion by 2025. Services can be the real secret weapon for driving that post-COVID economic recovery.
“We forecast that approximately one-third of that growth is going to come from modern digital, deliverable services like those in the information, communication and tech space, and the business-to-business services space.”
Fitzpatrick identifies an even greater forecasted growth in terms of cross-border trade internationally on top of the billions of dollars in projected growth within the market.
“When you look internationally, cross border trade in services is projected to rise from US$6.1 trillion to US$8 trillion by 2025; nearly a one-third increase in value,” he continues.
“That just demonstrates the fact that for so long the services industry has been under-represented and this is one of the reasons why we are keen to shine a light on sectors that are going to be able to drive that economic recovery.”
For businesses to maximise this opportunity, keeping up to date with the ever-shifting digital services landscape is imperative.
Preparing for whatever is thrown your way
According to Fitzpatrick, as more and more industries move towards a more digital approach to the services trade, ensuring your business stays up to date with the relevant technology is crucial.
He says he has seen countless businesses update and adapt by moving online over the last nine months.
“As most people work from home, we need to adapt and adopt some of those digital services, with distance continually becoming less relevant to trade.
“For sustainable growth, it’s essential that local small and medium-size businesses adapt quickly to take advantage of this opportunity in Australia.”
As businesses continue to strive to secure a part of the massive projected growth within the digital service industry, Western Union Business Solutions is committed to working closely with their partners to help them reach great heights.
Working together to achieve your business goals
Looking at the reason Western Union Business Solutions developed the GSTR report, Fitzpatrick says it’s simple: to help businesses thrive.
“The underlying reason as to why we partnered to produce this report is an important one,” he says.
“Our partnership with Australian businesses plays a fundamental role in enabling their growth and keeping them competitive in the international market.
“Western Union Business Solutions is a champion for the services industry in particular, and we can see through this report how well Australia is placed globally to take advantage of the growth opportunity in international services trade.
We want to help enable our current and future business partners to thrive.”
That collection of businesses encompasses over 37,000 companies of all sizes across countless industries.
Western Union Business Solutions enables companies of all sizes to send and receive cross-border payments and manage foreign exchange. With deep expertise in moving funds worldwide and access to more than 130 currencies, Western Union Business Solutions helps companies spend less time managing international financial transactions and more time growing their businesses.