As we approach the end of 2016, business leaders across the world are anticipating the testing times of operating in 2017, a year in which the business environment looks set to be particularly challenging as the world grapples with almost unprecedented economic and political change. Around the globe, small business leaders will need clear direction, nerve and resilience as markets and changes in political governing continue to test the economy.
Hong Kong’s next leader is set to be elected on 26 March, 2017. Before that, on 11 December this year, the 1,200 member election committee that will pick the next Chief Executive will be chosen.
The Chief Executive position is the most powerful in the city and uncertainty reigns over who will hold the position until 2022. This is unsettling for Hong Kong’s SMEs as they seek support from their elected leaders.
In the United Kingdom, there is still much uncertainty around Britain’s role in the world following the decision to leave the European Union. Up until the High Court’s ruling that Brexit cannot begin without MPs’ backing, Britain’s new Prime Minister, Theresa May, looked likely to trigger Article 50 before the end of March 2017, which would formerly start the two year exit programme. Though the Government is now set to appeal the decision in the Supreme Court, timings are now inevitably up in the air.
Irrespective of the schedule, negotiations need to be worked out with Europe, and new trade agreements need to be settled with non-EU markets across the world to ensure Britain remains a global player. Add to this the appetite for a second independence referendum in Scotland, and 2017 looks to be challenging for the UK’s 5.4 million SMEs.
The next German federal election will elect the members of the Bundestag, the Federal Parliament, on a date to be determined in 2017. At recent elections in Mecklenburg-Vorpommern in north-east Germany, the chancellor Angela Merkel’s Christian Democrats suffered one of their worst results in the party’s history, ending up with less than 20% of the vote. Germany, as the economic powerhouse of the EU, will need to lead the politico-economic union to shape its form without the UK and ensure that the country’s SMEs remain competitive.
Poland, as one of the members of the EU, will also have to play a role in how the EU continues now that Britain’s exit will result in it losing a sixth of its funding.
In Ireland, 2017 is set to be an interesting year. The nation’s government is facing a battle with the EU due to the tax arrangements it made with global technology brand, Apple. Apple has warned that future investment by global companies could be hit after it was ordered to pay a record-breaking €13bn (£11bn) in back taxes to Ireland. How this will end remains to be seen, but already there is a growing call among small businesses for increased support for them, not just the large global entities, from their government.
Finally, as I write this, the American people are preparing to take to the polls to elect a new president to run the world’s largest economy. In one of the most divisive campaigns in memory, America has a clear choice between two of the least popular presidential candidates in modern history. Whereas the administration of President Obama was welcomed with optimism and hope, the sentiment of this year’s historic election has been one of unease. This has been an unsettling period of time for the estimated 28 million businesses in the U.S..
Clearly, next year is one of enormous change. Yet as well as challenges there are opportunities. As the world shapes itself following a new U.S. president and an EU without Britain, it will be those small businesses that can demonstrate flexibility, strategy and foresight that will be best placed to profit.
Businesses around the world are not only facing up to the challenges of a new world order, but actively seeking new opportunities to help make their businesses thrive. SMEs need our support. Small businesses are often referred to as the backbone of the economy and they will be central to creating a more productive, higher skilled global economy over the months and years ahead.
Download the full Global Business Monitor report, featuring analysis of SMEs in Europe, North America and Asia, here.