A new survey of the top chief executive officers throughout the Caribbean found that one third of them don’t think their organizations will be economically viable in ten years, with daunting challenges – including a looming global recession, inflation and climate threats – on the horizon.
The findings were revealed in the Pricewaterhouse Coopers (PwC) 26th Annual Global CEO Survey, which explores the views of 4,410 chief executive officers around the world.
“CEOs’ race against time is especially urgent when it comes to climate change. Over the next 12 months, Caribbean CEOs see climate risk primarily impacting their cost profiles (68 percent) and supply chains (58 percent). Fewer are worried about climate-related damage to their physical assets (38 percent), which is interesting given the Caribbean’s geographical location. Given the growing vulnerability of risks such as a rise in sea levels, changes in rain patterns and temperatures, and increasing intensity of natural disasters to Caribbean small island developing states, it’s important Caribbean CEOs don’t run the risk of being blind-sided,” the survey states.
It continues, “The biggest near-term challenge facing CEOs, of course, is the state of the global economy. Not surprisingly, over 60 percent of Caribbean CEOs project that global economic growth will decline over the next 12 months, in line with 73 percent of global CEOs. Those expectations represent a stark reversal from the last Caribbean participation in the survey (conducted in 2020, released in January 2021), when a similar proportion (69 percent) anticipated improvement in global growth.
“That optimism – reflecting hope that economic conditions would continue improving as momentum around vaccine development and rollout in the Caribbean and the rest of the world picked up pace – was dashed in 2022 by shocks such as Europe’s largest land war since World War II, knock-on effects like surging energy and commodity prices, and accelerating general wage and price inflation.”
To offset these pressures, the majority of CEOs reported that they have cut operating costs, raised the prices of their products and services and diversified their offerings.
“In response to the current environment, CEOs reported cutting costs and spurring revenue growth. Interestingly, although 62 percent of Caribbean CEOs say they have already begun cutting costs, just 14 percent are implementing hiring freezes, and eight percent are reducing the size of their workforce. This could be something to do with the recent employee attrition rates, which surged over the past year or so in many markets, referred to as the “Great Resignation”. The majority of CEOs in the Caribbean (44 percent) appear to believe that those elevated churn rates will continue,” the survey said.
