Despite predictions of lower than global average GDP growth in New Zealand, two thirds of businesses are optimistic about their outlook for 2010, a global survey has found.Business advising company Grant Thornton surveyed more than 7400 private businesses
Despite predictions of lower than global average GDP growth in New Zealand, two thirds of businesses are optimistic about their outlook for 2010, a global survey has found.
Business advising company Grant Thornton surveyed more than 7400 private businesses across 36 economies for its annual International Business Report (IBR) released today.
Businesses in Australia, New Zealand, Canada, Malaysia and Germany recorded disproportionately higher optimism than suggested in the International Monetary Fund (IMF) forecasts for 2010.
Optimism in New Zealand businesses had risen greatly from last year's survey when only 15 percent were optimistic about their 2009 outlook. This jumped to 66 percent for 2010, the most optimism reported since the 18-year-old survey started including New Zealand in 2003.
New Zealand businesses were now the seventh most optimistic and that swing was encouraging, Peter Sherwin, a director of Grant Thornton New Zealand, said.
``It was particularly interesting that Australia weighed in the third most confident at 79 percent, which is not that far ahead of us -- especially when you consider that there is debate about whether Australia has ever actually been in recession.''
Most New Zealand businesses had scrutinised their operations, becoming leaner and more cost effective during the recession, which set them up well for recovery, Mr Sherwin said.
``As the global economy emerges from recession, we are likely to see many businesses reaping the rewards of recession induced efficiencies to lead the way in the upturn.''
However, the Government had yet to outline its plans to increase the country's growth, he said.
``Leadership from the Government must be the focus for 2010 otherwise it is clear that Australia, dubbed‘the lucky country,’ will continue to outstretch our growth in both GDP and wages.''
The survey found North Island businesses were more confident than those in the South Island, with 70 percent reporting a more confident outlook and 66 percent expecting increased revenues.
In the south, 57 percent had a more confident outlook and 42 percent expected increased revenues.
``This could be evidence of the more conservative approach from our southern businesses,'' Mr Sherwin said. Most businesses said in preparation for the upturn they would focus on the skills of their workforce, new target markets and new products and services. They gave low priority to mergers and acquisitions.
``The research confirms what we had already suspected. In New Zealand, privately held businesses haven’t preserved profit at the expense of their people. Half of the businesses surveyed had focused on up-skilling and maintaining and enhancing their current workforce in the recession. We’ve also seen a resurgence of tactical recruiting.''
Many talented business people had returned to New Zealand, and the challenge was now about retaining them, Mr Sherwin said.
``Their international experience is invaluable and can help New Zealand firms to look at new ways of doing business.''
The survey found businesses in Chile, India, Australia, Vietnam and Brazil were the most optimistic, scoring more than 70 percent.
The Philippines, New Zealand, South Africa, mainland China, Singapore, Canada and Hong Kong were close behind.
Many European countries remained pessimistic. Italy, Denmark, Finland and France scored, -10 percent or lower, Greece -23 percent and Ireland -42 percent.
Spain (-56 percent), and Japan (-72 percent), were again the most pessimistic economies in the world, though their figures were slightly up on last year.
Countries which the IMF's GDP figures for 2009 showed either avoided or suffered a relatively minor recession, such as Australia, mainland China, India, Vietnam, Brazil, Hong Kong, Canada and New Zealand, all featured at the top of the league table.
