UK CEOs hold their nerve despite rising global threats – PwC

pwc_logoThe UK’s CEOs are investing heavily in their people and future growth this year despite rising global risks, according to PwC’s 19th Annual Global CEO Survey published at the World Economic Forum in Davos.

The survey of over 1,400 global leaders, including 105 UK CEOs, reveals that 84 per cent of UK CEOs are confident in their company’s prospects for the year ahead, and a third are very confident. This level of confidence is slightly down on last year, where 85 per cent were confident, although 39 per cent were very confident.

While UK CEOs remain confident in their own businesses’ prospects, there are growing concerns about the global economy and the number of threats their businesses face. Three in 10 think the global economy will improve this year, down from 41 per cent last year, and the number who think it will decline has risen to nearly a quarter (23 per cent), from 18 per cent last year and none in 2013.

Sixty-one percent of UK CEOs see the US as the most important country for their growth over the next 12 months, followed by China (37 per cent) and Germany (35 per cent). While China’s economic rebalancing, falling crude oil price, and geopolitical security concerns are all impacting confidence in the global economy, it’s important to keep in perspective that the UK’s major export markets are the US and Europe, which account for around two-thirds of overseas sales.



CEOs of UK companies are also planning more M&A activity in the next year than any of their European peers – 64 per cent plan to complete a domestic or cross-border deal, compared to 58 per cent last year. The UK’s attractiveness as a place to invest also remains high, with the UK ranked as the fourth most important country for growth for global respondents, behind only the US, China and Germany.

Lindsay Gardiner
Lindsay Gardiner

Lindsay Gardiner, regional chairman, PwC in Scotland, said: “Despite ongoing global economic and geopolitical concerns such as over-regulation, fiscal austerity and the combination of a second year of low oil prices – now hovering at around $30 a barrel - and oversupply in the market, many UK business leaders remain confident about their prospects in the year ahead.

“Focusing in on just one of these factors, however, reveals the divergent impact it can have on industries. While Scotland’s oil and gas firms continue to navigate the maelstrom caused by the sustained, low oil price, focusing heavily on cash, cost reduction and innovation, other key industries such as chemicals, manufacturing, tourism and retail are benefitting from the combination of increasing consumer demands and lower energy and raw material costs.

“Overall, our UK CEOs remain resolute in their longer-term ambitions, driving through investment plans which include creating new jobs as well as developing their workforce. With almost two-thirds also planning to expand via a merger of acquisition, this steadfast approach should position UK companies well in the future.”

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