Five wildcards shaping global outlook

Photo by MART PRODUCTION

Kearney has released a report titled “World in Flux: Global Wildcards 2025–2030”. This 10th annual assessment by the Kearney Global Business Policy Council highlights five transformative forces expected to reshape the global operating environment for businesses over the next five years.

The report explores key global disruptions and business opportunities, with a spotlight on the rise of the Global South, the evolving trade landscape, technological shifts, and the growing influence of individuals in shaping global dynamics.

The rise of the Global South – encompassing “middle powers” like Indonesia and Vietnam is a central theme of the report. With a young and dynamic workforce, growing economic influence, and an expanding role in global trade, Southeast Asia is poised to be a key player in this transformation.

By 2030, the ASEAN-6 economies – Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam – are projected to become the fourth-largest economy globally, with a combined GDP of US$4.5 trillion. The region’s strategic positioning makes it a vital driver of global change.

Key Southeast Asia insights include:

  • The Rise of “Middle Powers”: Southeast Asia’s economies, including Indonesia and Vietnam, are positioned to serve as critical production hubs and trade bridges amid US-China tensions.
    The region’s ability to attract investment while navigating complex geopolitical dynamics is reshaping global economic flows. Businesses are expected to expand operations into the Global South, harness opportunities present with its young and dynamic workforce, and extend supply chain diversification strategies beyond traditional manufacturing hubs in Asia.
  • Trade Policy in Flux: Southeast Asia is bracing for the impact of potential tariff escalation and rising protectionism globally.
    While some countries including Vietnam and Thailand were able to boost exports on the sidelines of the US-China trade wars, the long-term effects of tariffs on consumers and businesses, the environment, and the world’s poorest countries, among others, will likely be adverse.
  • The Energy Demand Challenge: Rapid technological adoption and AI advancements are contributing to surging electricity demand across the region. Governments and businesses must work together to build resilient and sustainable energy infrastructure.
  • Technology and Corruption: Digital tools, including deepfakes, are amplifying corruption risks. Addressing these challenges requires public-private collaboration to foster trust and transparency, particularly in sectors like critical minerals.
  • The Era of “Super-Empowered Individuals”: Influencers and innovators are leveraging digital platforms to mobilize social, environmental, and economic change. This creates both opportunities and challenges for businesses including industry disruptions and CSR/ESG action.

 Varun Arora, Managing Partner for Southeast Asia, Kearney, commented that “Southeast Asia is poised for transformation, but this journey is not without challenges. While the region is reaping benefits from the global reset of manufacturing footprints and supply chains, the long-term impact of rising tariffs will strain consumers and businesses alike.

“AI advancements could lift GDP across Southeast Asia by 10 to 18 percent by 2030 – nearly US$1 trillion – bringing unprecedented opportunities. However, the region is not yet ready to meet the surging power demands this growth entails, putting immense pressure on sustainability targets and infrastructure resilience.

“Governments and businesses must act decisively to address these challenges. At the same time, the region must prepare for emerging risks, including deepfakes and cyber threats, as its global economic prominence rises. 

“Overall, Southeast Asia stands as a crucible of both opportunity and challenge. While the region’s strategic advantages position it as a global growth engine, its long-term success hinges on confronting looming hurdles. 

“To thrive in this environment, businesses must think boldly, invest sustainably, and leverage the region’s unique strengths to unlock opportunities.”

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