About 44% of Chief Executive Officers (CEOs) in Africa are changing their workforce strategy to improve competitiveness and stand above. They are also more confident in their own company’s revenue prospects and the strength of the global economy than they were in 2020.
This was disclosed by PwC in its Africa Business Agenda 2021 report on Friday. It also stated that the business leaders have concerns about government policy, cybersecurity, technology, and people.
Commenting on insights from the CEO survey, Uyi Akpata, Regional Senior Partner PwC West Africa, stated:
“In the light of the concerns that Africa’s CEOs have on policy uncertainty, tax policy uncertainty, cyber threats, and over-regulation, this is an opportunity for African business leaders to reimagine every aspect of their operating model.
Further, companies and countries in West Africa should take advantage of the Africa Continental Free Trade Area (AfCFTA) Agreement, which came into force on 1 January 2021, to drive growth and bolster their economies through increased continental trade.
In the wake of the pandemic and its impact on government revenues in African economies, it is no surprise that tax policy uncertainty made a notable rise on the list of threats. In Africa, it is ranked third, up from seventh last year.
CEOs are undoubtedly watching debts accumulate as governments intervene with stimulus packages, and realise that the public will expect businesses to pay their fair share. In Africa, 56% of CEOs are already factoring increasing tax obligations into their strategic risk management activities.”
“Plummeting government revenues and fragile economic growth are fueling an increase in government debt across Africa. This could result in tax aggression by government, increases in tax rates or introduction of new taxes. These could include, for example, digital taxes on platform-based companies that have profited during the pandemic.”
Solving the government revenue challenge will require making tough but informed decisions, which should include stopping wastage in government spending, rationalisation of incentives and subsidies, and boosting tax morale through accountability and transparency. Undue aggression against businesses and new or higher taxes will harm the economic recovery and discourage investments.”
On Workforce strategy, people and productivity, Partner & People Leader, PwC West Market Area, Omobolanle Adekoya, explained that the pandemic has highlighted the importance of people to organisational success.
She said, “This explains why 44% of CEOs in Africa, relative to their peers globally (21%), are changing their approach to performance management. Mixed blessings of technology. Automation and technology are great drivers when considering how to improve organisations’ competitiveness.”
What you need to know about Africa Business Agenda 2021
The Africa Business Agenda draws on the results of PwC’s 24th Annual Global CEO Survey.
PwC surveyed 5,050 CEOs in 100 countries and territories in January and February of 2021. The global and regional figures in this report are based on a sub-sample of 1,779 CEOs, proportionate to country nominal GDP to ensure that CEOs’ views are representative across all major regions. The results for Africa are based on a sub-sample of 50 CEOs from 14 countries.