Chief executives remain cautious about the global economic outlook despite New Zealand’s better-than-expected response to the pandemic.
An annual global survey by PwC of more than 5050 chief executives in 100 countries has found just 39 percent of 89 New Zealand chief executives surveyed believe the global economy would improve this year, compared with 70 percent of Australian chief executives and 76 percent of chief executives around the world.
PWC New Zealand chief executive Mark Averill said New Zealand’s closed border was perhaps one of the reasons for the lower rate of optimism.
“New Zealand is a smaller market, we’ve probably been a bit more restrictive, so therefore that’s got challenges around labour pool. We’ve also got greater dependency on sectors like tourism,” Averill said, adding that Australia had a broader-based economy with mining and other sectors and was therefore less dependent on tourism, which was hard hit by the pandemic.
Despite the uncertainty, he said New Zealand businesses were planning to invest more.
Nearly half expected to take on more staff (48 percent), with 73 percent expecting revenue growth this year, and 85 percent confident of revenue growth over the next three years.
“Where we are now in New Zealand is a lot better place than we expected to be 12 months ago and that’s indicated by optimism around global economic growth and certainly revenue growth in New Zealand and desire to invest in New Zealand. So that provides a really positive platform for Covid recovery,” Averill said.
New Zealand chief executives were more concerned about the ongoing pandemic (57 percent) than cyber threats (41 percent), supply disruptions (40 percent), skill shortages (38 percent) and over-regulation (37 percent).
Averill said New Zealand’s concern about the ongoing pandemic was not a surprise, given the ongoing uncertainty.
“So, businesses are observing what’s happened … the vaccine rollout programme being very successful in countries like the United Kingdom, so are keen to get the clarity as to when it’s gonna happen in New Zealand so they can plan for it,” Averill said.
While sustainability and climate change did not make the list of top concerns, the survey results suggest these issues were still on the agenda for business leaders.
“The urgency of addressing climate change remains and surpasses Covid-19 as a long-term challenge for the world,” it said.