African CEOs more upbeat about revenue growth than the global average, survey finds
African CEOs are more confident than their international counterparts about revenue growth over the next three years after the African Continental Free Trade Agreement (AfCFTA) was signed, according to a PwC report released at the World Economic Forum in Africa this week.
Confidence about their organisation’s revenues has been above the global average since 2016, reaching 93% in 2019, eight percentage points above the global average, PwC Africa CEO Dion Shango said.
Shango was commenting on PwC’s annual global CEO survey, released at the forum on Wednesday.
While trade in Africa forms less than 3% of global trade, CEOs are focused on opening their markets and the AfCTA is at the centre of this activity, Shango said.
“There has been a resounding yes to this as a positive development … We have been hellbent on trading with everyone else around the globe except for ourselves. This presents a huge opportunity for trading with one another,” Shango said.
The agreement, which came into effect on May 30, aims to create a single continental market for goods and services.
“Of course, we have to temper our expectations. We need to see a high level of political will for this to work and to see action on the ground,” he said.
While there has been a record rise in pessimism from CEOs when asked about the global economy over the next 12 months, it is not as pronounced among Africa-based CEOs, Shango said.
According to the report, 29% of global CEOs compared to 25% of African CEOs project a decline in global economic growth.
Business leaders are focusing their efforts on staying within their own geographic borders for revenue growth, the report says.
“This strategy is particularly relevant to CEOs in Africa who recognise the opportunity to build their own brands in markets where they have a stronghold and where there may be tremendous growth opportunities to be realised without much competition from global players,” the report said.
However, they remain concerned about policy uncertainty and excessive regulation as well as tax and fiscal pressure.
On Monday finance minister Tito Mboweni said SA would focus on leveraging the agreement, which it stands to gain the most from because of the country’s industrial base.