But they still have a long list of worries.
Half a decade on from a financial crisis that brought the world
economy to the brink, the immediate threats to corporate profits are
receding and chief executives are encouraged by a brightening
outlook in both the United States and Europe.
Yet they do not have to look far for future threats — from a
worrisome slowdown in emerging markets to uncertainty over the
tapering of Federal Reserve stimulus and concerns over increased
The annual PricewaterhouseCoopers (PwC) survey of more than 1,300
CEOs found that 39 percent were "very confident" their company's
revenues would grow in 2014, up from 36 percent a year ago.
While the trend is encouraging, the reading is still down on the 50
percent-plus levels seen in 2007 and 2008, highlighting how the
return to growth remains fragile and uncertain.
Significantly, CEOs were more upbeat in assessing the macro-economic
outlook than that of their own companies, with 44 percent now
believing the global economy will improve in the next 12 months
against just 18 percent a year ago.
The difference reflects the fact that economic issues are not the
only ones weighing on executives' minds, according to Dennis Nally,
the chairman of PwC International, who presented the findings on the
eve of the January 22-25 World Economic Forum.
"Even though there is a higher degree of optimism about the global
economy, there are still some pretty big challenges elsewhere to do
with the volatility of certain economies, concerns around regulation
and shifts in technology," he said.
In fact, concerns about over-regulation have moved to the top of the
agenda in the past year as new rules — many of which have been
debated since 2008 — are now being implemented, raising the cost of
compliance and taking up management time.
The weakness in some emerging markets and uncertainties about where
this leaves corporate strategies is a big talking-point for many
multinational companies, since it coincides with recovery in the
West and signs of progress in Japan's efforts to counter years of
In response, a number of CEOs are turning back to advanced economies
for growth, with the United States, Germany and Britain now seen as
more promising than previous high-flyers such as India and Brazil.
[to top of second column]
Nally said the trend was a key "headline" for Davos 2014 — a view
shared by other pundits converging on the Swiss ski resort for four
days of high-level discussions and networking.
Economies considered "dull and old" like the United States, Britain,
Germany and Japan will actually turn out to be the new locomotives
of growth in 2014, according to Nariman Behravesh, chief economist
The emerging economies, by contrast, are losing steam as a
commodities "super-cycle" — which has buoyed the likes of Brazil and
Russia — wanes and political uncertainties grow ahead of 2014
elections in Turkey, South Africa, India, Indonesia and Brazil.
"Business leaders are generally feeling better about the developed
markets and the prospects for the next couple of years but are
worried about certain emerging markets, perhaps even to the point of
curtailing some investment," said Barry Salzberg, global CEO of
Deloitte Touche Tohmatsu.
Other issues keeping top managers awake at night include concerns
about fiscal deficits, increasing tax burdens, the availability of
talent to fill key jobs, exchange rate volatility and unstable
capital markets, the PwC survey found.
The prevailing business mood paints a improving picture for job
prospects, with half of CEOs interviewed worldwide expecting to add
to staff in 2014, versus 45 percent a year ago.
But that modest pickup in hiring plans may not do much to dent
chronic unemployment levels in many countries.
Worldwide unemployment hit nearly 202 million in 2013, an increase
of some 5 million compared with a year earlier, according to a
report from the International Labour Organization on Tuesday.
(Editing by Jeremy Gaunt)
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