Singapore businesses struggle with rising costs in overseas expansion: report

On workforce readiness, skills mismatches (57%) and mobility barriers (35%) were the main obstacles to building globally capable teams. 

Rising costs, funding constraints, and skills gaps are the main challenges facing Singapore businesses as they look to expand overseas and adopt new technologies, according to a survey conducted by KPMG and the Singapore Institute of Directors (SID).

The insights are drawn from a quantitative online survey of 1,000 professionals, managers, executives, technicians (PMETs), and business owners in Singapore.

On overseas expansion, respondents cited higher business costs (51%) as the top barrier, followed by difficulty accessing finance (26%), supply chain challenges (25%), higher tariffs (22%,) and unfamiliarity with new markets (22%).

Regulatory complexity featured prominently, with many pointing to difficulties navigating local rules. Measures seen as most helpful included stronger trade partnerships (43%), targeted financial assistance (33%), and export promotion, particularly via digital trade platforms.

In technology adoption, especially AI, the biggest challenges were talent and skills gaps (54%), high adoption costs (52%), and unclear strategies (48%).

Cost concerns were largely driven by infrastructure and licensing expenses, whilst strategy gaps were linked to management expertise, digital trust, and data governance. Respondents said Budget support for AI adoption and clearer data governance standards would be most useful.

On workforce readiness, skills mismatches (57%) and mobility barriers (35%) were the main obstacles to building globally capable teams. Respondents highlighted the need for continuous upskilling, job redesign, and leadership development, alongside clearer pathways for career conversion and talent mobility.

Based on the findings, KPMG and SID proposed a range of Budget 2026 recommendations. These include strengthening Singapore’s role as a hub for global trade and capital flows through digital trade platforms, improved working capital access, and enhanced carbon and environmental data frameworks.

They also called for deeper public-private collaboration on AI, including shared data pools, trusted AI standards, and governance support.

On talent, proposals include measures to attract global experts, co-fund training and certification programmes, and raise leadership and board-level capabilities in sustainability and ESG.