CEOS ECONOMY OUTLOOK BUSINESS GROWTH
Global – CEOs across the world are bracing for a gloomy economy this year, but some are confident of their company’s revenue growth.
According to a study by PricewaterhouseCoopers, nearly half of 1,258 global CEOs believe the downturn will continue in the next 12 months, significantly more than the 15% who are confident the market will improve.
Four in ten CEOs said they “don’t know” if the economy will turn for the better, while 34% are expecting no change.
Although fewer CEOs are confident of revenue growth this year (40%) compared to last year (48%), the figures are still higher than 2009’s 21% and 2010’s 31%. APAC CEOs are also more confident (42%) of growth, compared to their counterparts in the US (25%).
“The optimism that had been building cautiously since 2008 has begun to recede,” Dennis Nally, chairman of PwC International, said.
“The ongoing debt crisis in the European Union, along with other lingering economic uncertainties, has deflated confidence in business growth around the world. Even the fast-growing economies of Asia and Latin America are not immune to the realities of continued economic stagnation.”
A separate survey of 3,000 Singaporean SMEs by the Singapore Business Federation and DP Information Group found a similar picture painted locally. Confidence amongst local companies fell seven index points to 51 from a year ago, but a reading about 50 indicates firms are optimistic about the next six months.
However, Nally is confident of a silver lining, and added the slowdown has allowed CEOs to learn to better manage their businesses more effectively and are better equipped to deal with uncertainty.
PwC’s report found CEOs had identified two main growth opportunities amidst the downturn. More than a third said they will be increasing market shares in existing markets, and also pointed at developing new products and services.
Additionally, 59% of CEOs said emerging markets will continue to be a key focus, as they believe these markets are more critical to their business growth than developed markets.
But CEOs are also worried about the talent crunch, with less than a third certain they are able to acquire the talent needed to implement their company’s strategies, and 18% expected to trim their headcount. While almost half (43%) of business leaders admitted it is now more challenging to hire in their industry, the other half said they intent to add staff.
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