Unemployment top concern for Brunei business leaders

Azlan Othman

Unemployment or underemployment posed the biggest management concern for Brunei entrepreneurs, according to an international survey on business leaders.

The Regional Risks to Doing Business Report published by the World Economic Forum (WEF) recently showed that executives in Brunei are worried most about the unemployment issue, followed by energy price shock as ranking second, cyber attacks in third, data fraud/theft in fourth and misuse of technology in fifth.

The result was based on a four-month survey of 12,879 business leaders in 141 countries.

Brunei was the only country in East Asia and the Pacific region along with Korea that chose unemployment as the biggest risk for doing business.

In Europe, Spain, struggling with youth unemployment, was the only country where unemployment topped the list.

Global unemployment decreased to just below five per cent in 2018, its lowest level in 10 years.

A global recession at a time of narrow fiscal margins and rapid technological change would make it much more difficult for both business and governments to continue to create new and well-paid job opportunities.

A potential consequence of such a scenario, “unemployment or underemployment”, ranked first by the greatest number of economies (30 out of 133) and third globally this year.

“Energy price shock” is another risk that deeply concerns the private sector, although one that can materialise in the responses for different reasons.

Its cause of concern demonstrated by recent attacks on critical oil infrastructure in the region, is that “energy price shocks” are not only linked to market forces, but also to geo-political tensions that endanger the supply of this basic commodity.

Businesses are likely experiencing heightened uncertainty around energy markets because of this risk.

Oil and gas remain primary sources of public revenue in the region, so a sharp fall in energy prices could require governments to make delicate spending adjustments, and more so when energy prices are heavily subsidised.

Alternatively, a shock in which energy prices spike rather than plummet would mean increased production costs for businesses and heftier burdens for households – 65 per cent of the world’s electricity is still produced from oil, gas and coal.

Environmental risks are among the leading concerns for doing business across East Asia and the Pacific, with “natural catastrophes” ranking first and “extreme weather events” ranking fifth.

The concerns about “natural catastrophes” were heavily driven by responses from Japan and New Zealand, where they ranked first, while in Indonesia and the Philippines they ranked third.