India 'buoyant territory' for investments though global outlook dim: Survey

Global growth pessimism among CEOs worst since 2012

A survey of global CEOs has termed India  a “buoyant territory” and “the rising star” among most attractive investment markets, even as a large number of corporate leaders presented a gloomy outlook for the world economy in 2019.

About 29 of global CEOs expect growth in 2019 to be slower than that in last year, the survey by PwC shows. It is the worst since 2012 when 48 per cent CEOs had a pessimistic view of the world economy, which was then recovering from a financial crisis. 

The apprehension, as suggested in the survey, is spread across all regions, but the strongest in North America and Western Europe. Though CEOs optimistic of a rise in global economic growth (42 per cent) far exceed those having apprehensions, they are fewer than last year (57 per cent). Global GDP growth has not crossed 4 per cent since 2011, according to the World Bank data. 

Growth confidence in the medium term, too, has plummeted to the worst since the 2008-2009 financial meltdown. Only 36 per cent CEOs are “very confident” about good growth prospects over the next three years, the lowest since in 2009 when 34 per cent of those surveyed had such expectations. 

Such a feeling may have an adverse impact on India, especially since the proportion of CEOs who are unsure about where to invest this year is bigger than the share of those hoping for a good return on investments in India. About 8 per cent CEOs think India is important for the overall growth of their organisations, while 15 per cent “do not know” where to invest. 

However, the survey report says India surpassed Japan and the UK as a better investment market, and that it is a “buoyant territory” in terms of CEO revenue confidence. “India is the rising star on the list of most attractive investment markets,” it says. 

Global giant PwC reached out to 1,378 global CEOs in more than 90 countries (or regions) in September–October 2018 for the annual survey, which is the 22nd in the series. The findings were released on Monday, ahead of the World Economic Forum meeting in Davos. 

“Trade conflicts”, “availability of key skills” and “protectionism” are the three biggest threats to growth in the Asia-Pacific region, which includes India, China and Japan. 

About 31 per cent CEOs in North America think that creating a direct link between education and employment is important. Only 11 per cent CEOs in the Asia-Pacific have this view. Skilling and re-training are considered important by 31 per cent CEOs in North America, and by 50 per cent of their Asia-Pacific counterparts. 

Policy uncertainty did not feature as a major threat in 2018, but 35 per cent of CEOs think that it will impact growth adversely in 2019. The survey also asked about the impact of "trade conflicts" for the first time, and 31 per cent of global CEOs expect it to push growth down in the coming year.