As high-powered CEOs flock to the snowy Swiss resort of Davos, they are loaded down with baggage — not just skis and iPads, but concerns about the global economy, public mistrust, disappearing jobs and a heap of other challenges.
A new survey on Tuesday showed a steady drop in the number of CEOs worldwide who are “very confident” that their companies will grow this year. The number fell from 48 percent in 2011 to 36 percent this year.
Amid this pessimism, most of them are carefully sticking to a few investments in tried-and-true markets, according to the survey by accounting firm PricewaterhouseCoopers.
“Most are saying that the global economy will stay about the same for the next 12 months. So, not encouraging, maybe not discouraging, but clearly that’s affecting their outlook for their own companies’ growth prospects,” PwC chairman Dennis Nally said in an interview.
“The degree of confidence across the board is really down, regardless of whether you’re in a developing market or a developed market,” he said.
It is down even in high-flying economies like China and Brazil. The most upbeat country was Russia, where 66 percent of CEOs are “very confident” of revenue growth this year, Nally said.
He said the survey sends a strong message to governments that they must fix economic problems, including disputed regulations, government deficits and tax issues.
“All of those are impacting CEOs’ levels of confidence to really deal with their businesses on a go-forward basis,” he said.
Uncertainty about tax and spending policies is at the root of the gloom, said John Veihmeyer, CEO of accounting firm KPMG’s US operations. He said it was frustrating that US government solutions “seem to be within our control,” but still out of reach.
“I think we have an opportunity for the US to lead the world onto a path of stronger economic footing and very robust economic recovery over the next five years,” Veihmeyer said. “It’s not going to be easy. There’s going to be pain and sacrifice.”
Nearly a quarter of the CEOs surveyed plan further job cuts — yet more than half of them say they have trouble finding people with the right job skills.
The UN labor agency said this week the jobs crisis has worsened; there were 197 million people who could not find a job last year and another 39 million who have given up looking for one.
Neely worries about a “lost generation” of job seekers and encourages young people to focus on gaining skills that are in demand — skills in areas such as the sciences, math, engineering and other technical areas.
Heading on Tuesday into the glitzy World Economic Forum, where more than 2,500 members of the political and corporate elite will debate the world’s top economic issues this week, many participants said their top worries are prospects for social unrest, a US recession, cyberattacks, natural disasters and a breakup of the 17-nation eurozone.
In a reminder of the tangible threats facing world leaders, more than 3,000 soldiers are on hand in Davos to guard against terrorist or other threats to the gathering, while police and other security officers tightly sealed the Alpine town to ward off protests.
Business leaders also recognize that public trust in corporations — including CEOs — is waning. The survey questioned 1,330 corporate leaders in 68 nations between September and last month, and more than half said they plan to do more to build an “ethical culture” at their firms this year.
“We’ve got to start to rebuild that trust,” Nally said.
CEOs may be turning more introspective now that the world has escaped, at least for the time being, another financial meltdown. A US economic recovery seems to be expanding. Central banks — especially the European Central Bank — have helped ease Europe’s three-year financial crisis, and governments in countries such as Spain and Ireland have stepped in to rescue their banks from the risk of collapse from bad property investments.
Yet the survey found that only 18 percent of the CEOs predict an economic improvement this year, and more than a third of them worry that a lack of trust in their industries puts their company’s growth at risk.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained