Economic disruption -- including possible recession in the US, the Euro zone crisis and China's slowing economy -- have taken a toll on the confidence of CEOs in the Asia Pacific region, said PwC that released results of a survey Tuesday.
According to the company, only 36% of executives surveyed say they are "very confident" of business growth over the next 12 months. Their prospects however improve in the longer term, with more than half (54%) expressing a high level of confidence for the next three to five years, PwC noted.
Asia Pacific CEOs also believe the region is on track to achieve greater economic integration, a top priority for the Asia Pacific Economic Cooperation (APEC), whose summit meeting begins in Vladivostok, Russia, later this week, PwC said. Nearly half of CEOs say removing barriers to trade in services is a key to greater integration within the 21 APEC members, said PwC, adding that CEOs also called on APEC's political leaders to harmonize regulations across the region and to do more to encourage labor mobility and the free flow of investment.
Top Economic risks
According to PwC, CEOs believe that the top economic risks to their growth were a spike in oil prices to beyond US$150 per barrel, a US recession, breakup of the Euro zone, and the slowing of China's growth to below 7.5% of gross domestic product.
Other top concerns cited were a major disruption of the internet or cyberattack, and a pandemic or natural disaster, PwC added.
Hong Kong among top draws for investment
Asia Pacific CEOs also say that China and the US are their dominant targets for investment over the next three to five years. Resource-rich areas such as Russia, Indonesia and Australia, and Asian services capitals like Hong Kong and Japan are also named as top draws for investment, PwC noted.
Meeting the need for talented and highly skilled workers remains a top priority for CEOs in Asia Pacific. While 40% say they plan to expand their workforce by at least 5% in the next three to five years, 42% think talent shortages in the region will worsen over the same time period, PwC said.
"Making progress on the many issues that face the diverse economies of the Asia Pacific region is no easy task," said Dennis Nally, PwC International Chairman. "CEOs have set some very clear challenges for the upcoming APEC summit. If the summit is to be deemed a success, we need to see some real progress on key issues such as harmonizing regulation and encouraging labor mobility in the APEC region."
CEOs: We use green tech
More than three quarters of Asia Pacific executives mentioned their organizations are using green technology to increase efficiency, and nearly 60% are adopting water conservation techniques, said PwC. To manage power usage and cost, 27% plan to generate their own power with renewable energy in the next three to five years, survey results indicated.
Using IT to meet customer expectations
In terms of IT, nearly 60% of Asia Pacific CEOs say there is a critical need to improve their use of technologies like cloud computing, digital devices and social media in order to meet customer and employee expectations, PwC said.
CEOs believe the top priorities of the APEC organization should be promoting the free flow of investments in Asia Pacific, harmonizing regulations and standards, and mapping skills in the region with an eye to helping ease restrictions on immigration, PwC revealed.