African CFOs are the least optimistic in the world

by Ofentse Sefolo
African CFOs are the least optimistic in the world

According to the latest results from the Global Business Survey undertaken by Duke University, the African Business Outlook is looking bleak. Corruption and a lack of adequate infrastructure seem to be the biggest problems in the business climate.

Central bankers, analysts and investors often rely on the results produced from Duke University’s quarterly survey of CFOs around the world. In 2013, the South African Institute of Chartered Accountants (SAICA) joined the survey, helping to establish the African Business Outlook.

Lindie Engelbrecht, SAICA’s Executive Director: Members and Global Alliances, notes that African CFOs have been, and continue to be, the least optimistic in the world – both about their companies’ prospects and their countries’ economic outlook. This is based on the survey results over the last four quarters.

“However, the trend of South African CFOs being more optimistic about their own companies than South Africa’s economy in general is continuing, increasing from 42.9% in the third quarter to 46.6% in the fourth quarter of 2016. Their optimism dropped to 39% in the first quarter of 2017, which is understandable, considering South Africa’s downgrade to junk status,” says Lindie.

South African CFOs rated the currency risk, economic uncertainty and government policies as their most pressing concerns in the last quarter of 2016. The volatility of the political situation was added to their list of concerns in the first quarter of the year.

“When asked which policies or problems needed to be addressed to improve the business climate in their countries, 66% of the respondents said that corruption had to be reduced, 52.8% believe that infrastructure has to be improved and 49.1% feel political instability needs to be addressed. Furthermore, African CFOs also believe future investment opportunities will be limited due to current debt burdens,” concludes Lindie.

For more information, visit www.cbn.co.za to which full thanks and acknowledgement are given.

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