SINGAPORE (Feb 21): An IDC study commissioned by Microsoft predicts that digital transformation will add about US$10 billion ($13.2 billion) to Singapore’s gross domestic product (GDP) figures by 2021 with an annual increase in GDP growth rate by 0.6%.

Entitled Unlocking the Economic Impact of Digital Transformation in Asia Pacific, the survey was conducted among mid- and large-sized companies across 15 economies in the region, and looks into the impact on and disruption of traditional business models as a result of digital transformation.

Out of the 1,560 business decision makers surveyed, 100 of the respondents from Singapore, out of which 98% said they are in the midst of their digital transformation journey.

Respondents in Singapore felt that 93% of jobs will be transformed in the next three years due to digital transformation, and 62% of the jobs in the market today will be redeployed to higher value roles or reskilled to meet the needs of the digital age.

Kevin Wo, Managing Director, Microsoft Singapore, believes Singapore is clearly on the digital transformation fast track.

Based on the survey’s findings, it is expected that approximately 60% of Singapore’s GDP will be derived from digital products and services within the next four years.

“Organisations in Asia Pacific are increasingly deploying emerging technologies such as artificial intelligence (AI) as part of their digital transformation initiatives, and that will accelerate growth even further,” says Wo.

“The rise of digital transformation in Singapore will affect the labour market where many types of jobs will evolve and change. What is encouraging is that 83 percent of the study’s respondents are confident that their young professionals already have future-ready skills that will help them transition to new roles. Governments and organisations should still focus on reskilling and upskilling, because continuous learning will be important in ensuring a successful workforce transformation for the digital age,” he adds.

The release of Microsoft’s study findings comes in the wake of Monday’s Singapore Budget 2018 announcement.

During his speech in Parliament, Finance Minister Heng Swee Keat highlighted the government’s plans to help firms adopt new technologies and innovate by raising tax deductions for research and development (R&D) related expenses; piloting a virtual crowd-sourcing platform for the development of digital solutions; as well as launching programmes to drive greater adoption of digital technology, automation and robots, among others.

See: Budget 2018 to encourage firms to adopt innovation to remain competitive

On this note, ride-hailing tech firm Grab is expecting to grow its R&D team in Singapore by more than 50% at the end of the year.

“Few in Singapore are experts in new technologies like data science, machine learning and artificial intelligence, and our priority is to arm local young talent with these highly sought-after tech skills... We have strong training programmes where local engineers, data scientists, product managers can work with global talent from our Seattle, Beijing and Bangalore R&D centres. We have also protected our IP in Singapore through registrations, and are pleased to see the government providing more support to encourage innovation here,” says a spokesperson from Grab.

“Everyone should benefit from the digital economy – from drivers using technology to earn incomes, to young talent learning new skills. Singapore companies like Grab must actively grow our tech ecosystem and push innovation boundaries to ensure every Singaporean can benefit from convenient digital services.”