Middle East CEOs confident about regional economic growth in 2023, latest PwC CEO survey finds
- Confidence: 61% of Middle East CEOs expect regional economic growth to improve in 2023 and are ‘very confident’ about prospects for business revenue growth over the next three years
- Transformation: Over half of regional CEOs (58%) are transforming their businesses by diversifying their products and services. They are also continuing to invest and do deals reflecting a continued momentum in capital market activity, especially within KSA and UAE
- Digitalisation and upskilling: Two-thirds of regional CEOs see technological disruption as a leading issue, with 84% of regional CEOs expecting to invest in automation, artificial intelligence, cloud technology in 2023 and 74% to invest in upskilling their workforce
- Acting on climate change: Almost 50% of Middle East CEOs have either taken steps to mitigate climate risk or are in the process of doing so
Dubai, UAE, 25 January 2023 – Middle East CEOs are optimistic about the region’s economic growth prospects, with around two thirds of business leaders expecting an improvement this year. Revealed today, the Middle East findings of the 26th edition of PwC’s global CEO survey, which polled 4,400 CEOs in 64 countries, finds that CEOs in the Middle East are confident in regional growth and are transforming their businesses embracing new technologies, investing, driving cost efficiencies, moving on deal activity and taking active steps to mitigate the risk of climate change.
However, CEOs hold a pessimistic view on the outlook for the global economy with 73% of global CEOs and 82% of regional CEOs expecting a decline in global growth over the next 12 months. Just 21% of North American CEOs and 18% of European CEOs are confident in revenue growth in their own markets. This contrasts sharply with the picture in the Middle East where 63% of regional CEOs are confident about their own companies’ revenue growth over the next 12 months, with 71% of senior executives confident about their outlook for the next three years.
Hani Ashkar, PwC Middle East Senior Partner, said: “In last year’s survey, CEOs in the region were optimistic about their near-term economic prospects. Today, macroeconomic volatility and geopolitical tensions are undoubtedly impacting the confidence of global CEOs’ outlook for the year ahead. However, responses from Middle East leaders for our 26th Annual CEO Survey paint an encouraging picture for 2023, with almost 61% of Middle East CEOs expecting regional economic growth to improve in 2023.”
He adds: “Our survey outlines key takeaways on how CEOs in the region are moving ahead to future-proof their companies and stay ahead of longer-term challenges.”
Transforming business to ensure long-term viability: CEOs in the Middle East are actively preparing for a dynamic period ahead with 58% of CEO’s already transforming and strengthening their businesses. Unlike their global peers, regional business leaders are proactively accelerating M&A activity with 76% not delaying deals vs 60% globally. Nor are they slowing down on investments with 58% of regional CEOs continuing to invest vs just 40% globally. Middle East executives are also focused on building efficiencies and resilience around their supply chains, with more than 70% looking to push through price increases and 84% seeking to reduce operating costs.
Investing in digitalisation and talent: As the Middle East continues with its ambitious digital transformation agenda, this year’s survey found that two-thirds of regional CEOs view technological disruption as a leading issue that will affect their industry’s profitability over the next decade, compared with just under half of global CEOs. This year’s survey indicates that Middle East senior executives foresee technology as a prominent feature in their plans with more than four in five regional CEO’s expecting to invest in automation processes and systems in 2023, and 66% expecting to deploy cloud technology, artificial intelligence, and other advanced technologies in operations. Attracting and retaining talent also remains a key focus with 74% of Middle East CEOs expecting to invest in reskilling their workforce, in addition to 84% of regional leaders planning on not reducing staff compensation.
Taking action to mitigate climate risk: Over the last 12 months, the region has significantly deepened its commitment to tackling climate change with government and private-sector pledges committing to meeting national net-zero targets, with momentum no doubt accelerated by the recent COP27 summit in Egypt and the upcoming COP28 summit in the UAE. This new sustainability mindset has resulted in almost 50% of Middle East CEOs taking steps to mitigate climate risk or innovating new products and processes to lower their carbon footprint and cut emissions.
Stephen Anderson, Middle East Strategy and Markets Leader, said: “This year’s edition of the Middle East CEO survey demonstrates that regional business leaders are balancing confident growth prospects along with the challenges of transforming their business to ensure resilience in the face of global volatility and concerns about long-term viability. CEOs are turbocharging on digital transformation through further investment and, as the ESG agenda continues to play an important and strategic role in reimagining a sustainable future for our region, it is evident from our latest survey that the story has moved from talk and reflection to action when it comes to climate change.”
PwC’s CEO survey outlines how Middle East CEOs are shining a beacon of confidence for 2023, giving a tangible glimpse into how they will navigate the global complexities of the months and years ahead and how this will shape the economies in which they operate.
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