(SINGAPORE) The spectre of a US-Iraq war and terrorism has not fazed corporate chief executives. Most still reckon their revenue will grow in the next 12 months, according to a global survey carried out by PricewaterhouseCoopers.
In fact, a surprisingly high 72 per cent of 992 CEOs polled worldwide see things panning out this way, according to PricewaterhouseCoopers (PwC) International's sixth Global CEO Survey.
'We are most struck by CEOs' level of confidence,' the global professional services firm says in a report. 'We take that response to mean not the birth of another boom but rather the first glimpse of a nascent expansion.
'Inventories have been cut, inflation and interest rates remain at historic lows and consumers have never stopped spending. The world feels ready for a new growth cycle.'
Compared with the previous poll, taken weeks after the Sept 11, 2001 attacks on the United States, almost half of the CEOs – close to a third of them from the Asia-Pacific region – said they are more confident now than they were a year ago about growth prospects. Some 27 per cent said they feel about the same.
CEOs in financial services, telecommunications and the entertainment business are the most upbeat about growth, according to the survey.
This suggests they sense that their industries may have hit bottom – and that renewed growth is on the horizon.
By region, North American (59 per cent) and South American (65 per cent) CEOs are more confident about the prospects for revenue growth than their counterparts in Europe (40 per cent) and Asia (44 per cent).
Many CEOs indicated that they are 'somewhat' or 'very' confident of meeting or beating revenue and earnings forecasts in the next 12 months. They see new opportunities in their markets and say they are well placed to take advantage of them.
More than half of the CEOs – many from Africa – said they see 'some' new growth opportunities in the current global climate, while 22 per cent said they see 'many'.
Yet many CEOs fear bureaucratic overreaction to corporate scandals could choke the new expansion to death even before it begins, says PwC.
And it's not just talking about the US. While accounting abuse and outright fraud have been committed mainly by US corporations, most CEOs polled said this is not exclusively an American problem – and regulators everywhere are ready to counter with stiff new measures.
Especially in Europe, CEOs fear overregulation more than a terrorist attack, the survey found. Europe has yet to be hit by major terrorist attacks like those in New York, Bali and Mombasa.
But global terrorism and war are very much on the minds of CEOs – especially Americans and Europeans – and mar their faith in the overall economy, even though they are upbeat about the outlook for their own businesses, PwC says.
For Asian CEOs, there is also a fear of deflation.
According to the survey, there's an apparent disconnect between government and business – although, for some CEOs, the perception is that if the relationship is not getting better, it's at least not getting worse.
Almost half of the CEOs polled agreed that government is out of touch with current business needs. An equal number disagreed that government priorities boost their business.
Almost half of the CEOs feel political leaders have become less responsive to the business community's agenda in the past two years. Relationships between government and business have in fact grown more hostile, they feel.