Firms more optimistic about economy

Corporate finance executives around the world are increasingly optimistic about the global economy, and a large number plan to…

Corporate finance executives around the world are increasingly optimistic about the global economy, and a large number plan to maintain or increase spending and hire more workers, according to a new survey released today.

The annual American Express/CFO survey of senior financial executives at large global companies showed that 71 per cent expect economic expansion in their countries over the next 12 months, up from 18 per cent last year. The optimism was spread across all regions, which included Asia, Europe and North America.

"We're seeing a significant shift to a more positive outlook among finance executives as companies have moved from simply surviving the present to investing in growth for the future," Gunther Bright, senior vice president of American Express's global client group, said in a statement.

The latest survey of 479 senior executives of large international companies was taken in April. The firms represent a wide range of industries in the United States, Canada, Mexico, Europe, Asia and Australia. Company revenues range from $500 million to more than $20 billion.

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The survey found that executives in Asia were the most optimistic about prospects for economic growth. Financial executives in Europe and the United States were more measured in their outlook.

In Asia, 87 per cent of f respondents said they expected economic growth in the next 12 months, compared to 64 per cent in the US.  Some 71 per cent of respondents in the United Kingdom and 66 percent in Germany said they expected growth.

Eighty percent of all respondents said they expect to see a sustained or increases demand for their companies' products.

Some 67 per cent of the executives surveyed said their firms plan to maintain or increase capital spending, and nearly two-thirds said they plan to hire more people.

The survey showed that 49 per cent of the executives plan to increase investment in new product and services development, while 46 percent planned to expand through increased marketing and sales activity. Only 31 per cent said they expected to invest in mergers and acquisitions to drive growth.

The survey also showed that business travel spending is beginning to stabilise after slowing down dramatically during the recession. The survey found that 57 per cent of executives plan to maintain or increase business travel spending compared to last year.

Reuters