UOB Indonesia: The Prospect Of The Business World Remains Interesting Even Though Overshadowed By Uncertainty

Illustration (Photo: Doc. Antara)

JAKARTA - UOB Indonesia stated that small and medium enterprises (SMEs) and large-scale businesses still show positive business prospects in 2023 amidst high inflation rates and global economic challenges.

This is summarized in the UOB Business Outlook Study 2023 which involves 530 companies from various sectors.

Director of Wholesale Banking UOB Indonesia Harapanman Kasan said that 90 percent of SMEs and large-scale companies in Indonesia feel optimistic about their business in the remainder of this year.

"Most of the positive business outlook sentiment was reported in sectors such as public and personal services and industry, oil and gas, and manufacturing and engineering," he said in a written statement, Thursday, September 14.

According to Kasan, most businesses are taking important steps to ensure they remain prepared for the changing economic environment.

"Adoption of digital solutions for automation processes and improving customer experience is a key step to drive growth," he said.

Kasan explained, in the next three years, the business world will prioritize business digitalization in order to increase efficiency in developing new sources of income, as well as providing skills or improving the skills of human resources.

"Businesses in sectors such as technology, media and telecommunications as well as professional services are at the forefront of digitizing business models to drive growth," he emphasized.

Beware of inflation

Even though the business outlook remains positive, the business world is still feeling the impact of rising inflation which can lead to higher production costs.

According to this study, it is stated that 9 out of 10 businesses in Indonesia are affected by high inflation, making it difficult for them to compete and can also result in reduced profits.

"Therefore, almost one in two businesses in Indonesia are focused on cutting the costs of company activities to overcome inflation," he added.

This study also highlights that almost 2 out of 5 companies in Indonesia are trying to build stronger supplier relationships to better manage their supply chains.

Meanwhile, cost-effective digital supply chains can help businesses mitigate the impact of inflation-induced shocks.

"Sectors such as industry, oil and gas as well as manufacturing and engineering will gain greater benefits from the right technological solutions," he concluded.