Chief executive officers of local companies are confident about the economy this year, as 44 percent said they expect further improvement, up from 40 percent last year, a survey by PricewaterhouseCoopers LLP (PwC) showed.
“Taiwanese CEOs are more positive about the growth outlook abroad than at home, consistent with a higher confidence reading for the global economy at 57 percent among peers worldwide,” PwC Taiwan chairman Joseph Chou (周建宏) told a news conference on Monday last week.
Only 30 percent of chief executives are confident about revenue growth in the next 12 months, lower than the global average of 44 percent, the survey found.
Foreign-exchange risks help account for the difference, as the ongoing appreciation of the New Taiwan dollar will erode corporate earnings if it does not weaken orders, Chou said.
The issue of populism was the executives’ top concern, according to the poll.
The government has taken cues from public opinion instead of professionals to guide its policy decisions, Chou said, adding that the situation is more evident in Taiwan than elsewhere.
Currency volatility was ranked the second-biggest threat that might affect corporate performance, according to the poll.
The local currency has risen 2.2 percent so far this year, on top of an 8.4 percent increase last year, data from the central bank’s Web site showed.
A strong NT dollar is unfavorable for companies, especially exporters, which are paid in US dollars and report losses when they convert the greenback into the local currency.
SUPPORT CONCERNS
Many firms have expressed worry that the central bank is less determined to support exporters following the retirement of former governor Perng Fai-nan (彭淮南), who had kept volatility in the NT dollar within 10 percent during his 20 years in office, Chou said.
“Many speculate that the new monetary policymaker would stay on the sidelines to avoid intervention charges from the US,” Chou said.
The government has demonstrated willingness to ease investment and business regulations, but the pace is not fast enough, he said.
Over-regulation ranked the third-biggest challenge to corporate operations this year, according to the survey.
The issue also tops the list of concerns among global chief executives, followed by terrorism and geopolitical risks, the survey said.
The poll surveyed 228 executives between October last year and January.
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