Sunday 29 November, 2020

Caribbean businesses fear second wave of COVID-19 - PwC survey

At 64 per cent, the biggest concern for Caribbean businesses is a second wave of coronavirus infections from COVID-19 according to the latest PricewaterhouseCooper's (PwC) COVID-19 CFO Pulse Survey.

The second biggest concern (61 per cent) is the impact of a global economic downturn as a result of the COVID-19 pandemic.

The virus has infected more than nine million people around the globe and killed more than 470,000 since it first emerged in Wuhan, China in late December 2019.

The latest PwC survey of 989 chief financial officers (CFOs) in 23 countries and territories, including over 40 CFOs in Jamaica and across the Caribbean, was conducted between June 1 and 11.

PwC noted that it is obvious from the survey that CFOs are focusing on regaining their footing, rebuilding revenue and reshaping their businesses.

The majority of CFOs surveyed in the Caribbean region (66 per cent) expect COVID-19 to decrease revenue/profits by 10 per cent or more, with 11 per cent indicating that while they expect a decrease, the range is unknown. Another two per cent said the impact is too difficult to assess at this point.

Most Caribbean CFOs (70 per cent compared to 63 per cent globally) stated that offering new or enhanced products or services was most important to rebuilding or enhancing their revenue streams. None are considering making cuts to digital transformation or cybersecurity.

In his comments, Leighton McKnight, PwC Jamaica leader and advisory leader for PwC in the Caribbean, said: “Caribbean finance leaders are now looking to balance their business strategy with the new requirements for doing business in this challenging era of unpredictability.”

Leighton McKnight, PwC Jamaica leader and advisory leader for PwC in the Caribbean

He said 70 per cent of CFOs are planning to focus on product innovation and this is a good sign.

He added: “COVID-19 has created opportunities and it will be good to see businesses evolving and adapting to remain profitable. CFOs are also concerned with bringing people back into workspaces and reorganising to keep both employees and clients safe. This isn't surprising, but if companies implement the right measures to keep employees and clients safe and take a phased approach, they'll be better able to focus on working to survive and thrive as we move forward.”

“There are also significant opportunities for business leaders to step up and deliver on the larger purpose of the corporate community that is, creating opportunities and investing in people and communities in order to grow the economy,” McKnight added.

Caribbean edition survey highlights:

Financial actions

  • 77 per cent of respondents are considering implementing cost containment.
  • 50 per cent of respondents are considering deferring or cancelling planned investments as a result of COVID-19.
  • Zero per cent of CFOs are considering cuts to digital transformation, cybersecurity, research and development.

Workforce impact

  • 32 per cent say in the next month they expect a productivity loss due to lack of remote work capabilities.
  • 34 per cent say in the next month they expect a change in staffing due to low/slow demand (temporary furloughs).

Return to the workplace

  • 77 per cent are very confident they can meet customers' safety expectations.
  • 82 per cent are very confident they can provide clear response and shut-down protocols if COVID-19 cases in their area rose significantly or if there was a second wave of infections
  • 73 per cent are very confident they can provide a safe working environment.

Emerging stronger

  • 77 per cent say the current work flexibility will make the company better in the long run (e.g. hours, location).
  • 59 per cent say the current situation has resulted in better resiliency and agility which will make the company better in the long run.
  • 70 per cent say technology investment from the current situation will make the company better in the long run.
  • 59 per cent say the current situation has resulted in new ways to serve customers, which will make the company better in the long run.

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