Two-thirds of Azerbaijani companies' heads confident in growth of profits - PwC (UPDATE)

Business Materials 15 March 2018 17:31 (UTC +04:00)
Roughly 66 percent of chief executives of companies in Azerbaijan are confident in the growth prospects of their companies' profits

Details added (10:49)

Baku, Azerbaijan, March 15

By Maksim Tsurkov – Trend:

Roughly 66 percent of chief executives of companies in Azerbaijan are confident in the growth prospects of their companies' profits, Managing Partner of PwC Azerbaijan Movlan Pashayev said at a presentation of the report 'CEO Survey-2018' in Baku on March 15.

He said that the mood and prospects of both global and local leaders were rather dark when conducting a similar survey two years ago.

"It is very gratifying that Azerbaijan managed to overcome many of the challenges it faced in the economy in a comparatively short two-year period. The 2018 report showed that 66 percent of chief executives are confident in the growth prospects of profits of their companies," Pashayev said.

He noted that the optimism level of CEOs both globally and in Azerbaijan is the highest since 2010.

"This level has almost doubled compared to the previous survey. The chiefs see the growth prospects in short and medium terms for their business, while economic and commodity prices are stabilizing, with many countries pursuing institutional reforms and diversification. The recent crisis has led to disruptions, and it turned out to be the main catalyst for changes, positively impacting both private and public sector enterprises, forcing them to review their strategies and business models," Pashayev said.

He noted that 45 percent of the chief executives expect an increase in global economic growth over the next 12 months. Two years ago their percentage was 23.

"This roughly corresponds to the global indicator. Thus, 57 percent of the interviewed CEOs around the world believes that the economy will grow," Pashayev said.

He noted that during the survey, the heads of companies pointed to the main economic problems they face. The biggest of them - volatility of Azerbaijan's manat rate, followed by threat of tax burdern increase and uncertainty of economic growth.

Pashayev further noted that CEOs also identified the main direct threats to their businesses.

"Particularly, 83 percent of respondents see the lack of professional skills in the market and poor confidence in this business as a threat. Some 75 percent identified changes in the behavior and expenses of consumers as a threat," Pashayev said.

As for the main foreign attractive markets, CEOs highlighted Russia and Turkey, like a year ago, he added.

"At the same time, China entered the top three this year, surpassing Iran. It is noteworthy that this time Iran did not even enter the top six. Only three percent of the respondents voted for it, and we believe that this reflects current geopolitical and economic trends," he said.

He added that today only three percent of the surveyed chief executives do not exclude the possibility of staff reduction (compared to 20 percent worldwide), while last time this figure was 50 percent in Azerbaijan.

"Moreover, today 50 percent of the chief executives are going to increase the staff number," Pashayev said.

The CEO survey is compiled for 19 years, and is presented at the Davos Forum every year. This survey was compiled on Azerbaijan for the second time. The aim is to identify regularities in the global economy, which can be an additional guide for the business community and politicians in decision-making.

Some 40 heads of both public and private companies from leading sectors of the economy participated in the survey on Azerbaijan.