Global chief executives rank the UK as the third most important country for investment, joint with Germany and behind only the US and China.
Despite recent political turmoil, chief executives are increasingly bullish about the UK, according to PwC’s 26th annual CEO Survey.
Only 9 per cent selected the UK as a market to grow revenue in 2020, compared with 18 per cent who selected it this year.
Kevin Ellis, chairman and senior partner of PwC UK, said that strength in areas such as artificial intelligence and biotech, alongside a business-friendly environment, made the UK an increasingly attractive market.
“Chief executives don’t expand and invest on a whim — they’re choosing the UK, as that’s where they expect to see returns,” he said. “To keep the UK attractive, we need renewed focus on skills and regional growth — both of which will help unlock productivity.”
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The survey of 4,410 chief executives in 150 countries was published to coincide with the World Economic Forum in Davos. It reveals that UK bosses are more upbeat than their international counterparts: only 4 per cent of UK chief executives expect the economy to decline significantly, while the proportion among global CEOs is three times higher, at 12 per cent.
However, only 21 per cent of UK chief executives expect the global economy to improve over the next 12 months, down from 82 per cent last year.
Despite the caution about the global economy, UK chief executives are upbeat about their own companies’ prospects: 48 per cent are “very or extremely confident” about their prospects over the next 12 months, compared with 42 per cent of global CEOs.
The confidence means that 59 per cent of UK chief executives do not intend to cut headcount and 86 per cent won’t reduce employee pay.
In the longer term, almost one in four UK chief executives fear their companies will not be economically viable within a decade without significant changes to their business model.
The global picture is even starker, with 39 per cent of chief executives around the world believing their business will not be economically viable on current trajectories, compared with 22 per cent of UK chief executives.
Ellis said: “Businesses have already undergone massive change this decade. But this is the tip of the iceberg — many CEOs believe their current business models are unsustainable, and this means more change ahead. This isn’t about tinkering but fundamental changes requiring big investment in people, skills and technology.”
More than a quarter (26 per cent) of UK chief executives said they were “moderately or extremely exposed to the threat of climate change over the next 12 months”, compared with 39 per cent of chief executives globally. Chief executives in China feel particularly exposed, at 59 per cent.