Chief executives of Luxembourg firms are more worried about the long-term prospects for their businesses than their counterparts in other countries, according to a new survey presented on Wednesday by consultancy firm PwC.
They showed that only 51 percent of Luxembourg CEOs believe that their company will be economically viable for more than ten years if it continues running on the current path, compared to 59 percent of global CEOs.
PwC said it observed a significant divergence between Luxembourg CEOs on one hand, and CEOs from Ireland and the UK on the other, whereby 76 percent and 75 percent respectively believe that their business will be economically viable for more than ten years.
‘Alarming contrast’
“The contrast is even more alarming” with regard to (financial services) respondents, PwC said, with only 46 percent of Luxembourg respondents declaring that their operation will remain economically viable for more than 10 years, compared to 71 percent in Ireland and 73 percent in the UK.
Financial services CEOs “may be questioning the future viability of the Luxembourg financial hub vis-à-vis other European financial centres – notably Dublin and London – for a number of reasons,” PwC said.
“Supplemental analysis conducted by our team shows that Luxembourg (financial services) respondents are less sanguine on their growth prospects, perceive inflationary pressures as a more persistent key threat and expect higher resignation and retirement rates than their peers in the above financial centres.”
PwC CEO and senior partner John Parkhouse (photo) said the firm’s survey, conducted biennially for 26 years now, noted that the optimism from 2021 has been dashed as 2022 has been a year of extraordinary macroeconomic and geopolitical shocks.
Polycrisis
“We appear to be entering an era of ‘polycrisis,’ to borrow a term recently popularised by the World Economic Forum, as we see a plethora of inter-related crises impacting the world and the business agenda, driving uncertainty and a need to focus more on the short-term, whilst not losing sight of the race of tomorrow,” Parkhouse said.
“We believe that Luxembourg and its business leaders are provided with an opportunity to not only weather the storms of today but rather to seize the opportunity to invest, upskill and collaborate with a view on building the foundations for an ever more prosperous tomorrow,” he said. “The unique structural selling propositions of Luxembourg remain still strong and intact, i.e. the robust economic growth, excellent country rating and a deep pool of expertise and competencies, distinctive even in a competitive global market.”