Business leaders gloomy ahead of World forum

Wednesday, January 25, 2012

DAVOS, Switzerland - Business leaders are gloomy about prospects for the world economy, according to a major survey of international chief executives released on the eve of the Davos forum.

A survey of 1,258 bosses by accountancy firm PricewaterhouseCoopers, timed to coincide with the World Economic Forum of the global business elite, found 48 per cent expect economic decline and only 15 per cent growth.

European business leaders were the most pessimistic, amid fears governments are not up to the task of resolving their debt crises and concerns about the stability of capital markets, the firm said at the ski-resort summit.

"CEO confidence is decidedly down as they deal with the aftershocks to the recession," said Dennis Nally, chairman of PwC International.

"CEOs are disappointed with the course of the global economy and the pace of recovery. The optimism that had been building cautiously since 2008 has begun to recede."

Oddly, despite their concerns about the world economy as a whole, most of the bosses surveyed expected their own firms to increase revenue, although even there confidence was well down on last year.

While the gloom was deepest in the developed economies of Western Europe, confidence was down even in the bigger emerging markets, which many experts hope will be a source of growth for the rest of the world.

China saw the biggest decline in confidence in the Asia Pacific region, with only 51 percent of CEOs feeling "very confident", down from 72 per cent last year, and in India a belief in revenue growth dropped from 88 per cent to 55 per cent.

Africa was the only source of optimism. Some 57 per cent of chief executives there expected their firms to grow, up from 50 per cent in 2010.

The World Economic Forum is a five-day summit of the world's top political and business leaders which starts on Wednesday in the Swiss resort of Davos.