Global chief executive officers (CEOs) are less optimistic about improvement in economic growth in 2015 compared to a year ago; they rank the US the most important growth market over the next 12 months, ahead of China, the first time in five years. India's CEOs, however, buck the global sentiment with their enthusiasm for expected improvement in business climate.
These are the findings of PwC's 18th Annual Global CEO Survey based on interviews with 1,300 CEOs across 77 countries, carried out in the last quarter of 2014.
Only 37 per cent of the CEOs surveyed think economic growth will improve in 2015, against 44 per cent the year before. Significantly, 17 per cent of the CEOs believe global economic growth will decline, more than twice as many as a year ago (seven per cent). Forty-four per cent expect economic conditions to remain steady.
The survey, released ahead of the the 45th World Economic Forum meeting at Davos, comes at a time when the world economy is nervously staring at the prospect of a global economic slowdown.
CEOs in emerging economies such as India (59 per cent), China (46 per cent) and Mexico (42 per cent) are more optimistic about the global economy than those in developed economies such as the US (29 per cent) and Germany (33 per cent).
Global CEOs appear to have more confidence in the performance of their own companies than in global economic growth. As many as 39 per cent CEOs said they were 'very confident' that their company's revenues would grow in the next 12 months.
CEOs ranked the US as their most important market for growth over the next 12 months - overtaking China for the first time. Thirty-eight per cent of CEOs say the US is among their top three overseas growth markets, compared with 34 per cent for China, 19 per cent for Germany, 11 per cent for the UK and 10 per cent for Brazil.
CEOs of Indian companies top the list, with 62 per cent confident in their short-term growth prospects. Other leading countries include Mexico (50 per cent), the US (46 per cent), Australia (43 per cent), the UK and South Africa (39 per cent), China (36 per cent), Germany (35 per cent) and Brazil (30 per cent). Among the least confident countries are France (23 per cent), Venezuela (22 per cent), Italy (20 per cent), Argentina (17 per cent) and Russia at the bottom of the list at 16 per cent.
To strengthen their companies, 71 per cent CEOs say they will cut costs over the next 12 months; 51 per cent will form strategic alliances or joint ventures; 31 per cent will outsource a business process or function; and 29 per cent will complete a domestic merger and acquisition.
CEOs who say they will add headcount in the course of the year include those from the asset management, health care, pharmaceuticals and life sciences, business services, and technology industries.
Indian CEOs buck the global sentiment of gloom, with 62 per cent confident of growing the company's revenues in the next 12 months, while 71 per cent CEOs were confident of growth over the next three years. A massive 84 per cent of India's CEOs believe there are more growth opportunities for their companies today than three years ago.
India's CEOs put the US (48 per cent) ahead of China (26 per cent) as the most important market for their growth in the next 12 months. That would be music to the ears of President Barack Obama, who is scheduled to land in India later this week.