The cloud of the economic deceleration of the euro zone, the commercial tensions between the United States and China or the Brexit let feel its effects. 48% of Spanish businessmen believe that the economy will get worse in the next 12 months, according to the report Perspectives Spain 2019, prepared by the consultancy KPMG and the Spanish Confederation of Business Organizations (CEOE). In the previous edition, only one in 10 managers was distrustful of the evolution of the economy.
Even so, entrepreneurs are positive about the future performance of their activities: 69% of them believe that they will increase their turnover in 2019, compared to 77% of the previous edition. This optimism is reflected in more data: almost four out of 10 executives trust that they will be able to increase hiring and 40% expect to maintain their workforce. Although 21% believe that it will have to carry out adjustments, compared to 17% of the previous report.
The challenges that can be seen on the international scene and that can reduce the activities of companies, both Spanish and foreign, are several. The OECD has just cut the growth prospects of the euro zone from 1.8% to 1%, and the ECB lowered them from 1.7% to 1.1%. To this slowdown are added the political uncertainty in Italy, the Brexit, the slowdown in Chinese investments or the lower growth of Germany.
In this context, orOf each 10 businessmen who have participated in the study -made from more than 1,000 surveys-, they point out that political uncertainty will be the main threat to the Spanish economy in 2019, a similar percentage to the previous study, followed by the slowdown in the Eurozone. (a 48%). 37% mention the regulatory environment and 33% mention geopolitical tensions.
Among the risks of a business nature, the one that causes the most uncertainty is the regulatory one, for 69% of managers. This list also includes climatic and environmental risks, which create concern for 14% of the interviewees. Regarding the internal situation, 67% of executives say that The impact of the political situation on your company's activity in 2018 It has been negative -from 53% of the previous edition-, especially in terms of investment decisions and hiring of personnel.
The managers of the technology companies are the most positive about the future of the economy and the turnover of their activities, while those who work in the sectors that suffer most from the effects of the economic slowdown and the impact of digitalization, such as the automotive industry, They are the least optimistic. Several car companies, such as Ford, have already announced workforce reductions, and others, such as Volkswagen, have warned of job cuts that will involve the transition to the electric car.
Also, in terms of investments, prospects are good. One in two entrepreneurs plans to increase them, and 37% keep them at the same level. The focus is on digital transformation and improvement of processes, which along with the need to develop new products and services are among the strategic priorities of the respondents. 66% of them state that their main investing efforts will be aimed at technological tools, in particular advanced data analytics systems and cloud services.
"Managers look with caution at the economic evolution in the face of the forecasts of deceleration and the geopolitical uncertainties, but at the same time they maintain investments in technology to accelerate their digital transformation processes ", summarizes Hilario Albarracín, president of KPMG in Spain.
90% of Spanish businessmen surveyed also say that the digital transformation of their business has already begun and more than half of them state that the results are being positive. The aspects that have benefited the most from technological improvements have been the relationship with customers, cost reduction and production processes.
Half of the managers surveyed in the report Perspectives España 2019 of KPMG and CEOE affirms to maintain commercial relations with the United Kingdom. Among the main negative effects of leaving the country of the European Union, Spanish businessmen consulted point to the contraction of the British economy and regulatory changes, but also the depreciation of the pound or restriction of the free movement of people who can affect the recruitment of talent or the tourist flow, one of the leading sectors of Spain.