Global CEOs are remarkably optimistic about the economy in the year ahead, according to a survey of nearly 1,300 of them released yesterday by PwC for the Davos confab. Some 57% said the economy will improve in the next 12 months, which is the most optimistic reading in the seven years PwC has been conducting the survey.
The U.S. is viewed as the best market for investment—a sentiment that has modestly increased in the year since Trump became president. Of the CEOs surveyed, 46% said the U.S. was the best place to invest, up from 43% last year, while 33% chose China—the same percentage as last year.
Interestingly, the biggest risks seen by CEOs were more political than economic. Those in the U.S. cited cybersecurity as the top risk; Europeans and Latin Americans chose rising populism; and Middle Easterners cited “geopolitical uncertainty.” Only in Asia did the CEOs cite economic factors—the skills shortage and the rapid pace of technological change—as the top threats facing their business.
I spent some time in Davos yesterday with Microsoft President Brad Smith, who echoed the survey findings. “In our lifetime, there has never been a time when the macroeconomic outlook and the geopolitical outlook have been so disconnected,” he said.
The PwC survey also showed that nearly half the CEOs share a concern that future economic growth will benefit “the few,” not “the many”—a function of the winner-takes-most nature of today’s digitally driven businesses. Along those lines, Smith and Microsoft’s EVP of Artificial Intelligence, Harry Shum, are circulating a new book that, among other things, explores the demands that AI is going to create for new skills and job retraining. Smith is advocating a focus on apprenticeship programs, like those in Switzerland, as one way to address the critical challenge.
Meanwhile, the most frequently asked question in Davos this week is: “What will Trump say?” This annual gathering has become the epicenter of globalization, and the U.S. president has been its most ardent critic, making his speech Friday a subject of heightened speculation. Stay tuned.
More news below.
A magnitude-7.9 quake has struck in the Gulf of Alaska, prompting tsunami warnings in Alaska and British Columbia. Washington, Oregon, California and Hawaii have also been put on tsunami watch. Elsewhere on the Ring of Fire, a magnitude-6.1 quake struck Indonesia and a volcano erupted in Japan. Fortune
Blow to Fox’s Sky Takeover
The British Competition and Markets Authority has provisionally nixed 21st Century Fox’s $26 billion takeover of media company Sky, saying it may not be in the public interest as it would put too much power in Rupert Murdoch’s hands. Fortune
Stocks Rally on Shutdown Shutdown
President Donald Trump has signed a bipartisan bill that gives three weeks of funding to the federal government in exchange for a promise that the Republican-controlled Senate will reopen negotiations on the future of “Dreamers” and border security. With the U.S.’s three-day shutdown now over, European shares opened to new highs. Reuters
Ex-KPMG Partners Charged
Three former KPMG executives have been arrested and charged with conspiracy for allegedly gaming audit inspections. The Securities and Exchange Commission says they used leaked information from the Public Company Accounting Oversight Board to pass inspections. CNBC
Around the Water Cooler
Trump’s Solar Tariffs Target China
President Donald Trump has approved duties of up to 30% on foreign-made solar equipment, which largely comes from China. Although higher costs are predicted for installers in the U.S., their shares jumped as the tariffs were lower than the 35% floated last year. The U.S. also placed 20% tariffs on imported washing machines. Fortune
Uber in Africa
Will Uber take heed of investor SoftBank’s recent suggestion that it should focus only on its core markets in the U.S., Europe, Latin America, and Australia? A spokesperson said the company is “very much committed to our successful businesses across Africa,” so the jury’s out for now. iAfrikan
Budweiser Is Slipping
Budweiser is no longer one of the U.S.’s top three beers, according to new data, having been knocked into fourth place by Miller Lite. The other two top beers are Bud Light and Coors Light. However, even the top three have seen sales slip as a host of craft beers become more popular. Fortune
Hugh Masekela Dies
The internationally renowned South African jazz trumpeter Hugh Masekela, whose music was an integral part of the soundtrack to the struggle against Apartheid, has passed away at the age of 78 following a battle against prostate cancer. BBC