It seems New Zealand's leaders don't have high hopes when it comes to global growth outlook
A recent survey which gathered responses from CEOs all over the world seems to suggest that New Zealand leaders are among the least optimistic when it comes to global growth outlook.
According to PwC New Zealand’s CEO survey, just 32 per cent of local CEOs expect the global economy to improve this year – a significant drop from the 59 per cent of CEOs globally and 70 per cent in China.
Mark Averill, CEO and senior partner at PwC New Zealand, said the pessimism could be a result of businesses getting to grips with a change in government and a heightened focus on regulation as well as broader social and environmental challenges.
“We’ve seen CEOs face an uncertain start to 2018. After a general election late last year, which coincided with our surveying, along with volatility in the equity markets this year, it’s no surprise that CEOs here are feeling more cautious,” he said.
However, while CEOs aren’t certain about global growth, Averill said they’re far more optimistic about their own prospects.
“While it might seem like CEOs are pessimistic, our local respondents are bullish about their own growth prospects,” he said. “They’re looking at what they can control; their supply chains and expenses, in order to get fit for the future.”
The study found that while local CEOs are worried about global economic movements, they’re more confident in their own growth (89 per cent are planning to grow this year).
When asked what the biggest risks to growth were, both social and business risks were among the most pressing – terrorism entered the top 10 list for the first time while cyber-attacks were identified as the number one risk to growth.
“CEOs are clearly getting up to speed on digital and technology, but the fact cyber-attacks are the top risk to growth shows how vulnerable New Zealand organisations are,” said Averill.
“All businesses are now looking at the people and capabilities they’ll need to transform their business models,” he continued. “Digital and cyber security skills are just the beginning – we also have to be building diverse teams that can cut across traditional business silos.”
Threats to growth are coming from beyond business as well with a growing awareness that social and political concerns – like over-regulation, climate change and populism – could hamper local growth plans.
“Dealing with uncertainty has to be part of business planning for 2018. We have to be partnering across industries and between government and business to address social issues like cyber security and climate change,” said Averill.
“This means becoming more nimble and developing a 2018 agenda that is agile enough to handle anything that is thrown their way.”
