World witnessing biggest energy crisis in history: IEA chief tells WEF

DAVOS: Middle East oil economies, and especially their booming sovereign wealth funds, are well placed to ride out a global fall in executive confidence, according to a senior partner of global consulting firm PwC.

Speaking on the sidelines of an event at the World Economic Forum Annual Meeting in Davos, Kevin Ellis, PwC executive in charge of UK and Middle East business, told Arab News: “As the world changes, it needs energy and money. There is a huge role there for the Middle East.”

PwC recently announced its most gloomy survey of sentiment among 4,410 chief executive officers for at least a decade. The poll showed that some 40 percent of CEOs believed their organizations would not be economically viable 10 years from now if they did not transform.

The survey also revealed that 73 percent of global company bosses believed economic growth would decline around the world in the next year, driven by inflation, macroeconomic volatility, and geopolitical conflict.

Risks associated with the cost and disruptions of climate change also weighed on CEO sentiment.

The Middle East, however, was one of the regions where CEOs were found to be more optimistic, buoyed up by rising energy prices, an increase in government revenues, and soaring rates of gross domestic product.

Ellis said: “I think they’re going to benefit from the oil prices, and they’re going to benefit from their efficiencies there. But also, they’re investing as well. I mean, investing in various different forms of energy, in terms of digital and a lot of investment in the future going on, using that oil price revenue.”

That was in stark contrast to the picture painted of overall global economic conditions by Bob Moritz, global chairman of PwC. In particular, leaders in France, Germany, and the UK were less optimistic about their own growth than about global growth in general.

Moritz said: “A volatile economy, decades-high inflation, and geopolitical conflict have contributed to a level of CEO pessimism not seen in over a decade.”

But he saw some grounds for positive change.

“CEOs globally are re-evaluating their operating models and cutting costs, yet despite these pressures, they are continuing to put their people front and center as they look to retain talent in the wake of the great resignation.

“The world continues to change at a relentless pace and the risks facing organizations, people, and the planet, only continue to rise,” he added.