CEOs look to Asia for growth

GLOBALISATION and growth are back on the agenda for chief executives as they seek to gain from a mixed recovery, a new survey showed yesterday.

Confidence among company heads worldwide is returning to a level to rival boom years such as 2005 and 2006, as strict cost control and restructuring over the past two years have strengthened business models.

And chief executives’ love affair with high-growth Asian markets continues unabated, the 14th Annual Global CEO Survey from PwC found.

It showed 92 per cent of western European chief executives expected growth in their Asian operations, compared with 48 per cent in their Europe businesses.

In the finance sector, 36 per cent of bank heads said they had fundamentally changed strategy in the past two years to cope with the altered landscape and growing focus on risk.

Asset managers and insurance CEOs were among the most optimistic and more than half of respondents in both sectors were investing in new product offerings. Asset managers were keen to capitalise on ageing populations’ desire to save for retirement, while a quarter of insurance firm heads anticipated making a cross-border acquisition in the next year, with Asia the most likely destination.

But emerging markets were not the only target for growth (see graphic, below), as 22 per cent of chief executives named the US one of their most important markets and 14 per cent named Germany.

Many were concerned over the divergence of recoveries within the global economy and said their strategy would change to accommodate this. Volatility in emerging markets was also a concern for 71 per cent.