Despite the governments in the African nation’s attempts to improve the ease of doing business, growth prospects for firms operating in the continent is very low, according to PricewaterhouseCoopers (PwC).
A survey conducted by PwC revealed that only 27 percent of African CEOs are confident that their companies will make a profit in the next twelve months.
The same survey by PwC revealed that companies operating in Africa are expecting slow revenue growth. This can be attributed to excessive regulations and unfriendly corporate policies still prevailing in African countries.
It is noteworthy that 10 of the fasting growing economies in the world are from the African continent.
PwC surveyed 171 CEOs in 19 African countries. The CEOs are from companies which have revenues in excess of $100 million.
The PwC survey also revealed the problems and hurdles faced by firms operating in Africa such as unstable business environment, political instability, and excessive rules and regulations. The firms also have to deal with increasing and burdensome taxes, volatile exchange rates and the growing risk of cybercrime.
However, East African countries such as Kenya, Uganda, and Tanzania have significantly done well when it comes to the ease of doing business. Currently, in the World Bank’s ease of doing business ranking, Kenya is ranked at 61, Uganda at 127 and Tanzania at 144.
Dion Shango, CEO for PwC Africa told the media that, “As they look forward to the year ahead, African CEOs are less confident about the prospects for the global economy than they were a year ago. The same is true when they consider the prospects for their own organisation’s growth.”
He added, “In Africa, economic and policy uncertainty, among other issues, have cast some doubt upon business leaders’ hopes for immediate and future growth. Although there is a drop in optimism, African business leaders do see some opportunities on the continent but overall, they are playing it safe.”