Global chief executives hopeful of recovery
AS the World Economic Forum gets under way today in Switzerland, chief executives are confident the world has averted a prolonged recession, but are concerned that government regulators may slow the pace of economic recovery, according to a survey released yesterday.
Over four in five company heads worldwide are optimistic about business conditions over the next year, according to the survey by PriceWaterhouseCoopers. CEOs pessimistic about growth prospects dropped by half to 18pc, while the very optimistic rose to 31pc.
All those figures represented a sharp turnaround after the remarkably dismal outlook recorded last year. Still, confidence was significantly stronger among the top business brass in China, India and other emerging economies than in the US, Europe and other rich nations.
"In some fast-growing economies, the turnaround is well under way, but CEOs in the countries hardest hit by the crisis see its effects remaining through 2010 and beyond," said Dennis Nally, PriceWaterhouseCoopers' global chairman.
The rising confidence should result in new jobs created in 2010, the study said, touching on the most important economic challenge for governments and companies this year. Up to 40pc of CEOs plan to add payroll, while a quarter say they are planning to cut more jobs.
But the hiring prospects differ among countries, with Asian, Canadian and Brazilian CEOs among the most confident of adding staff.
Only a fifth of British bosses expect their staffs to rise by more than 8pc, but in the US, there was greater pessimism.
Nearly two in three American CEOs expected recovery to really begin in the second half of the year, according to the survey, while the same share of Chinese CEOs felt their economy was already bouncing back last year. The spread was more even when bosses were asked about long-term prospects. More than 90pc of all CEOs expect growth over the next three years, a strong rebound from the depths of global economic crisis last year, when only a third were as confident.
Chief executives, however, expressed concerns, especially about over-regulation from governments. Some even cited public bailouts as a danger. "CEOs were very clear about the threat of over-regulation," according to PriceWaterhouseCoopers, which interviewed 1,198 heads in 52 countries over the last four months. "They also opposed government ownership in the private sector even in the worst of times."