Despite the restored confidence of African business owners regarding the strength of the global economy and the impact on their businesses, a few factors keep them up at night, a report by consulting firm, PwC.
The report noted that factors such as over-regulation, tax policies, policy uncertainty, and cyber threats make CEOs in Africa “anxious”.
This was disclosed in the eighth edition of PwC’s Africa Business Agenda 2021 report released 9 June 2021.
Expressing faith in the growth of the global economy in the next 12 months was 68 percent of African CEOs, a spike from the 20 percent recorded in 2020.
However, in terms of growth prospects in their businesses, only 30 percent of African CEOs believed that there would be significant growth in the next twelve months, a 6 percent decline from the 2020 survey figure which stood at 36 percent.
Beyond the 12-month growth projection, 42 percent of CEOs on the continent expressed optimism in their companies’ revenue growth over the next three years, the report said.
The CEO of PwC Africa, Dion Shango, noted that CEOs in Africa were “playing it safe” which can be linked to the pandemic and the various responses from the different governments on the continent and policies that could impact their businesses.
Shango said, “In Africa, economic and policy uncertainty, among other issues, have cast some doubt upon business leaders’ hopes for their own companies’ immediate growth prospects. Although there is a drop in optimism over the short-term, African business leaders do see some opportunities on the continent – but overall, they are playing it safe.
“The reasons for this gap in confidence vary from African countries still being at an earlier stage of the pandemic life cycle to uncertainty about governments’ COVID-19 response and policy direction in its aftermath.
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“Despite the current uncertainty, many African business leaders have found that the COVID-19 pandemic has also unleashed extraordinary energy, creativity and resourcefulness within their organisations.
“We can expect to see a continuation of accelerated digitalisation brought to the fore by the pandemic, which promises productivity, data-driven insights and other business benefits, but at the same time increases the threat of cyberattacks and the spread of misinformation.”
More Concerns of African CEOs
The report analysed the threats envisaged by CEOs in Africa alongside their global peers. It stated that in the survey it conducted, African CEOs were “more concerned about the perennial challenges of” policy uncertainty (Africa: 60 percent; Global:38 percent); over-regulation (Africa: 48 percent; Global 42 percent); tax uncertainty (Africa: 56 percent; Global:31 percent); cyber threats (Africa: 54 percent; Global: 47 percent).
It added that compared to their global peers, African CEOs worry less about the existential threat of the COVID-19 pandemic, with only 48 percent and 52 percent globally.
Focus has shifted from the pandemic to things within their realm of control such as organic growth, operational efficiencies, and strategic partnerships.
“Overall, the sheer magnitude of concern about most threats has increased since our 2020 survey, despite CEOs’ rise in confidence. Among CEOs in Africa, navigating these perils is a permanent state of being, which conflicts with their inherent optimism. Navigating this tension is a perennial leadership challenge that currently seems to be particularly acute,” the CEO, PwC Southern Africa, Shirley Machaba, was quoted as saying.
