CEOs not prepared for likely recession

24 per cent of East African CEOs have planned for the recession compared to 76 per cent of global CEOs. [iStockphoto]

Only a handful of business leaders in the region anticipate a possible global recession next year, a new survey shows.

The new study by global audit firm KPMG, however, reveals that chief executive officers (CEOs) are taking austerity measures in the face of a deteriorating business environment.

Compared with their global counterparts, regional CEOs, the study shows, are equally slowing down some aspects of their firms.

According to the 2022 KPMG East Africa CEO Outlook Survey, only about three out of 10 CEOs (28 per cent) in the East Africa region believe there will be a recession in the next 12 months.

This is compared to 86 per cent when the same view was sought from global CEOs.

Given this, only 24 per cent of East African CEOs have planned for the recession compared to 76 per cent of global CEOs. Yet a majority of CEOs across the board (73 per cent) believe that a recession would turn their anticipated growth upside down.

The survey notes that despite concerns over the anticipated recession, business leaders in the region have adopted or are planning to adopt resilience measures to weather the arising challenges.

These include diversifying supply chains, pausing or reducing spending on digital transformation strategies, and pausing or reconsidering existing or planned environment-sustainable efforts.

"Most of these organisations are well prepared," said Partner and Head of Advisory KPMG East Africa Gerald Kasimu.