Middle East CEOs' Confidence Soars, Yet Economic Viability Concerns Loom Large
In the latest PwC's 27th Annual CEO survey, insights from 4,702 executives across 105 countries reveal a contrasting blend of optimism and transformation concerns among Middle East CEOs. The survey captures a snapshot of sentiments surrounding economic viability, regional growth expectations, and responses to technology disruption and climate change.
Economic Optimism and Growth Projections:
Middle East CEOs exhibit a sense of economic optimism, with 73 percent anticipating improved regional economic growth in the coming year, surpassing their global counterparts at 44 percent. Furthermore, 66 percent of Middle East CEOs expect significant revenue increases over the next three years, reflecting a outlook. A noteworthy 65 percent plan to expand their workforce in 2024.
Key Threats and Risk Agendas:
Despite the positive outlook, CEOs in the region acknowledge prevalent risks. Geopolitical conflicts, inflation, and cyber risks top the risk agendas of regional CEOs, underscoring the multifaceted challenges faced by businesses in the Middle East.
Transformation Imperative:
While acknowledging the positive trajectory, 48 percent of Middle East CEOs express concern about their company's economic viability a decade from now if they fail to evolve. This concern aligns with the ongoing transformative initiatives across the region, driven by the imperatives of digitisation, decarbonisation, localisation, privatisation, and modernisation.
Responses to Transformation:
CEOs in the Middle East are actively reinventing their businesses, with a focus on diversifying products and services. Notably, more than half of the CEOs emphasise the importance of tech innovation as a priority area for the next three years.
Generative AI at the Forefront:
The Middle East is emerging as a key player in harnessing advanced technologies, including Generative AI. A significant 73 percent of CEOs believe that Generative AI will significantly alter the way their companies create, deliver, and capture value in the next three years. Anticipating positive impacts, a quarter of CEOs expect job creation, 77 percent foresee improved work efficiency, and 63 percent anticipate increased revenue with the adoption of Generative AI.
Climate Change and Corporate Responsibility:
In response to the global call for climate action, 36 percent of regional CEOs identify climate change as a key driver for corporate change in the next three years. While CEOs in the Middle East align with their global peers in implementing energy efficiency programs, just over half are innovating new climate-friendly products or services. Challenges such as inadequate returns on climate-friendly investments, regulatory complexities, and insufficient stakeholder demand are acknowledged.
Leadership Confidence and Future Projections:
Hani Ashkar, PwC Middle East Senior Partner, notes that businesses in the Middle East are actively evolving through advanced technologies and display a heightened awareness of issues like climate change. CEOs project confidence and commitment to reshaping the region for sustained outcomes.
As global dynamics shift, the Middle East positions itself at the forefront of technological innovation and climate responsibility. With CEOs leading transformative initiatives, the region appears prepared to play a crucial role in a post-COP28 world, impose opportunities and addressing challenges for sustained growth and resilience.
