NAIROBI, Kenya, Mar 4 – Chief Executive Officers (CEOs) in the East Africa region are cautious about global economic growth, with only 42 percent saying that the growth will improve in the next year.
According to PwC’s East Africa CEO Survey, which sampled a total of 231 East African CEOs’ expressed fear over inflation, macroeconomic volatility, cyber risk, and geopolitical conflict,.
They stated that the above concerns significantly impacted how businesses operate and their profitability.
“There is a great deal of uncertainty in the world right now. The long-term effects of COVID-19, geopolitical tensions and conflicts, climate change and a slowdown in the global economy have somehow made CEOs in Africa accustomed to uncertainty and their organizations are more resilient as a result,” said PwC Eastern Africa Country and Regional Senior Partner Peter Ngahu.
The survey, however, indicated that East Africa’s CEOs are optimistic about their local territory’s growth prospects in 2024, although they are not oblivious to the medium-term challenges, including limited financial resources.
70 percent of CEOs indicated they are optimistic about their local territory’s growth prospects over the next 12 months, attributed to the uptick in infrastructure investment in the region, tourism recovery, and economic diversification.
The report showed that, despite the ongoing challenges, their companies’ positive financial performance may also increase confidence in local economies.
“More generally, macroeconomic volatility remains a top concern for both East African and Global CEOs but even more so for East African CEOs,” Ngahu added.
“Notably, respondents identified the regulatory environment as a significant obstacle against growth, indicating the potential impact of compliance requirements on operational flexibility.”
“Limited financial resources also posed a constraint.”
The report concluded that Kenya and China continue to top the list of the most favorable countries for CEOs’ companies’ revenue growth prospects, standing at 26 and 21 percent, respectively, over the next year.
East African CEOs also identified neighboring countries that are members of the East African Community (EAC) as territories for future revenue growth.
“Intra-EAC trade reached US$10 billion in September 2022, up from US$7.1 billion in 2019,” he said.
“The regional block aims to increase intra-EAC trade from 20 to 40 percent over the next five years, which could unlock future revenue growth opportunities.”
