PwC CEO survey: the trust in global economic growth is shaken

According to the latest Global CEO Survey by PricewaterhouseCoopers (PwC), trust in a global economic growth has become smaller in almost every country. 30 percent of executives think that global economic growth will reduce in the next 12 months – this proportion is six times bigger than the 5 percent measured last year. PwC’s 22nd global survey was conducted with the participation of more than 1,300 CEOs.

The survey’s result is surprising in the light of the fact that last year the proportion of CEOs expecting a global economic growth jumped from the previous year’s 29 percent to 57 percent. Not everything is lost, though, as 42 percent of respondents still hopes for an improvement in economic perspectives. Pessimism has increased the most in the USA, where 63 percent of CEOs had been optimistic in 2018, but this year only 37 percent remained positive. Bob Moritz, global chairman of PwC told: trust has been shaken by tensions in international trade and protectionism getting stronger.

As for the future of their own companies, 35 percent of CEO were ‘very hopeful’ about sales growth in the 12 months to come; last year 42 percent was measured. In order to increase sales, CEOs plan to rely on better operating efficiency (77 percent) and organic growth (71 percent). In the ranking of the most attractive markets the USA has remained the No.1, although only 27 percent of CEOs named the country as their main target market – in 2018 this proportion was 46 percent. Among other important countries from a sales growth perspective we find Germany, which was named by 13 percent of CEOs instead of last year’s 20 percent.

While the indicators forecast a global economic slowdown, CEOs are focusing on the upturn in populism in those markets where their companies are present. Among the 10 factors that can be the biggest obstacles to growth, last year’s terrorism, climate change, and rising taxes have been replaced by trade conflicts, political instability and protectionism. 88 percent of the CEOs who are worried about trade conflicts are particularly concerned about the trade problems between China and the USA.

CEOs aren’t satisfied with the data analysing capabilities of their companies: they are struggling with a considerable lack of information. Less than one third of CEOs think that they receive information that is comprehensive enough to make important decisions. Tamás Lőcsei, CEO of PwC Magyarország told our magazine that the lack of information is the biggest problem in the domain of customer needs. This must change if companies wish to stay sustainable and a successful part of the economy and society. What do CEOs think is the reason for not having enough data? 54 percent said it is the ‘lack of analytical expertise’. About the workforce shortage: CEOs agreed that there is no rapid solution to this problem. 46 percent believe in the retraining of workers and 17 percent reckon that a strong workforce providing channel must be created in the educational system.

No less than 85 percent of CEOs agreed with the statement that artificial intelligence (AI) is going to change their companies’ business operations in the next 5 years. Nearly two thirds of them said AI will have a bigger influence on the world than the internet. Despite this opinion, 23 percent of CEOs don’t plan any kind of AI-related project, while 35 percent intend to take steps in this field in the next 3-5 years. The results of the 8th Hungarian CEO Survey will be available from 6 March. //