Amid global challenges, 84% of Singaporean businesses aim to expand internationally. Consumers embrace cross-border shopping, with 84% open to physical goods and 74% to digital services.
Stripe, a financial infrastructure platform catering to businesses, has released a report highlighting the transformative impact of digital trade on the worldwide economy. According to the findings, both consumers and businesses hold a positive outlook on the globalized economic landscape. Businesses are actively seeking opportunities to venture into new international markets, while consumers are increasingly displaying a willingness to engage in online cross-border transactions for goods and services.
To compile this report, aggregated transaction data from the Stripe platform was used coupled with surveys conducted among 1,700 business leaders and 11,500 consumers spanning nine prominent global markets. These markets encompass Australia, France, Germany, Ireland, Japan, Mexico, Singapore, the UK, and the US. The report serves to illustrate how technology is facilitating the diversification of international trade pathways, consequently granting businesses of all scales in Singapore enhanced access to the global economy.
The Key findings from this report are as follows:
Optimism Surrounding the Globalized Economy Among Businesses and Consumers
In the face of macroeconomic challenges, both businesses and consumers maintain a positive outlook on expanding their engagement beyond Singapore. A significant 84% of businesses are poised to venture into other countries within the upcoming two years, with an additional 30% envisioning a remarkable international growth of over 75% in the ensuing five years.
Navigating the path to international triumph demands intricate strategies for hyper-localized market expansion, presenting a complex endeavor to achieve and execute. Nonetheless, businesses in Singapore perceive a more lenient operational environment today, contrasting with the past. A substantial 59% believe that managing international operations is more streamlined than it was five years ago, while merely 25% find it to be more challenging.
This positive sentiment and eagerness towards the global economy extend to consumers as well. A notable 84% of Singaporeans now express willingness to engage in cross-border purchases of physical goods, alongside 74% displaying openness towards acquiring digital services from international sources.
Enhanced Global Economy Access Enabled by Digital Trade
In the realm of global commerce, digital exports are disrupting conventions and granting diverse businesses, spanning from ‘single-person multinationals’ to well-established traditional giants predominantly operating offline, access to international markets.
On a global scale, a significant eighty-one percent of individual entrepreneurial ventures now engage in international sales, marking the emergence of what could be termed ‘single-person multinationals.’ Among these ventures, eighteen percent market their offerings across more than eleven global markets.
Conversely, at the opposite end of the business spectrum, sizeable traditional enterprises with extensive workforces are also embracing the idea of expanding their operations beyond borders. In the period from 2021 to 2022, Singaporean enterprises exhibited a remarkable 61% surge in utilizing digital platforms on Stripe for international sales. This trend is echoed globally, as fifty percent of enterprises intend to amplify their international footprint over the coming two years.
Even industries traditionally reliant on offline operations, such as education, are undergoing a digital metamorphosis within the context of the global economy. A substantial eighty-eight percent of education-oriented businesses worldwide are currently participating in international sales, and an impressive 70% harbor aspirations for further international expansion in the ensuing two years.
Digital Trade Expanding and Diversifying International Commerce Pathways
Internet-Enabled Economic Infrastructure Empowers Global Trade, Yet Untapped by Most Businesses.
While the potential for businesses to engage in global trade exists thanks to the economic infrastructure of the internet, a vast majority of businesses have only scratched the surface of this potential.
Despite the fact that numerous digital export routes experiencing rapid growth connect neighboring countries, there are notable exceptions that stand out. Both Australia and the UK have identified Ireland as the swiftest-growing digital export destination. Similarly, for the US and France, Germany holds this distinction. Among Singaporean businesses, the most rapidly expanding digital export market is Japan, marked by an impressive 60 percent year-on-year growth between 2021 and 2022.
The geographical scope of digital export routes is also expanding across all the countries scrutinized in the report. Drawing from Stripe’s transaction data of 2022, the leading five digital export markets for Australia, Mexico, Singapore, the US, and the UK span three continents. As for Singaporean enterprises, the top five digital export markets in 2023 encompass the United States, Australia, the United Kingdom, Malaysia, and Japan.
“Digital trade is creating opportunities for businesses to expand their total addressable markets, but success never comes easily,” said Mike Clayville, chief customer officer at Stripe. “Businesses need simple financial infrastructure that just works, no matter where they sell to. Our findings show businesses are increasingly taking advantage of this potential—and that’s something to celebrate.”