South African CEOs cautiously optimistic about their own company’s growth in 12 months

Dion Shango CEO of PwC Southern AfricaThe majority of CEOs worldwide are optimistic about the economic environment amid geopolitical uncertainty, corporate misconduct and the impact of artificial intelligence on the future job market, according to PwC’s 21st survey of 1,293 global CEOs

About 57 per cent of global business leaders said that global economic growth is expected to improve in the next 12 months. This percentage is almost twice the level of last year (29 per cent).

According to the report, the CEOs in South Africa are less confident than their global counterparts regarding their growth prospects in 2018. About 22 per cent of CEOs in South Africa are ‘very confident’ of their company’s own growth in the next 12 months, 20 points below the global average (42 per cent). However, South African CEOs are slightly more confident about their own company’s prospects for revenue growth over the next three years.

Commenting on the survey results, Dion Shango, CEO of PwC Southern Africa, said, “CEOs’ optimism in South Africa is more tempered than that of the developed economies, especially regarding their own organisations’ prospects for revenue growth. The state of the economy, unemployment and political uncertainty, among other issues, are casting a shadow over business expectations.”

The CEOs’ outlook improved in several major markets including in Australia (up four per cent to 46 per cent) and China (up four per cent to 40 per cent), where the majority of CEOs said that they are ‘very confident’ in their own organisation’s 12-month growth prospects rose.

The confidence of CEOs has recovered in the US. After the US general election in 2017, the early focus on regulation and tax reform by the new administration has seen confidence in business growth prospects rising significantly, from 39 per cent in 2017 to 52 per cent in 2018. North America is the only region where a majority of CEOs are ‘very confident’ about their own 12-month prospects.

In the UK, with Brexit negotiations only recently reaching a significant milestone, business leaders’ drop in short-term confidence is unsurprising (34 per cent in 2018, compared to 41 per cent in 2017).

The report further stated that the CEOs across the world are increasingly concerned about broader societal threats such as geopolitical uncertainty, terrorism, the rise of populism, and climate change, in addition to direct business risks such as cyber threats and the speed of technological change.

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