Kenyan CEOs Optimistic on Global Economy, Eye East African Growth

According to a recent survey by PwC, which encompassed the opinions of 4,702 CEOs across 105 countries and territories between 2 October and 10 November 2023, CEOs in Kenya are cautiously optimistic about the global economy’s prospects over the next 12 months. This optimism is shared by a notable 56% of Kenyan CEOs who believe that the global economic growth will either improve or remain steady. This perspective is slightly more optimistic than the global average, where 54% of CEOs shared similar sentiments.

Kenyan CEOs are particularly focused on regional opportunities, with 86% eyeing neighbouring countries in East Africa as key areas for revenue growth in the forthcoming year. This regional optimism is backed by their companies’ performance histories, suggesting a confident outlook towards their future growth prospects.

Amidst this economic optimism, climate change emerges as a significant concern, highlighting its critical importance to Kenya’s economy. While a majority of CEOs are actively engaging in climate action initiatives, nearly half (46%) cite the lack of demand from external stakeholders as a major obstacle to decarbonization efforts.

A split among CEOs regarding the long-term economic viability of their companies reveals a cautious perspective. They question whether their current operational paths will sustain them for a decade or more. Despite these concerns, there’s a strong focus on innovation, with 60% attributing a fifth of their 2023 sales to new products and services introduced in the past three years.

Inflation remains a pressing concern, with 58% of CEOs viewing it as a significant threat, though there remains a confident 56% who are optimistic about their revenue growth over the next three years. Peter Ngahu, PwC Kenya and Eastern Africa’s Country and Regional Senior Partner, reflects on the survey’s findings, noting the heightened state of uncertainty that CEOs in Africa, influenced by factors like COVID-19, geopolitical tensions, and economic slowdowns, have grown accustomed to.

The survey highlights the necessity for CEOs to champion transformation and innovation within their organizations, a sentiment echoed by Muniu Thoithi, Advisory Leader for PwC East Africa. Thoithi underscores the importance of CEOs leading their companies through continuous reinvention to thrive amid disruptions. Similarly, Isaac Otolo, Deals Partner at PwC Kenya, emphasizes the significance of strategic partnerships across industries to amplify value creation in evolving business ecosystems.

With climate change being a pivotal focus, 60% of Kenyan CEOs are undertaking measures like improving energy efficiency and offering climate-friendly products and services. Edward Kerich, Partner and Environmental Social & Governance Leader at PwC Kenya, points out the long-term value and evolving market dynamics favoring climate-friendly investments despite the initial high costs and regulatory uncertainties.

Additionally, the rapid advancement in generative AI technologies brings about its own set of challenges and opportunities. A substantial 78% of CEOs express concerns over the potential increase in cyberattack risks due to the unintended consequences of AI. Laolu Akindele, Technology Partner at PwC Kenya, advises on the importance of integrating cybersecurity objectives into business strategies to mitigate risks while harnessing AI’s productivity benefits.

This comprehensive survey, capturing a wide array of CEO insights, underscores the complex interplay of optimism, strategic planning, and concern for sustainability and digital transformation shaping the future of businesses in Kenya and across the globe.