CEOs gloomy about global economy

Almost half of company chief executives are pessimistic about prospects for the global economy this year, with many citing uncertainty about the European debt crisis as their major cause for worry, according to a survey published Tuesday.

Consulting firm PricewaterhouseCoopers polled 1,258 CEOs around the world and found 48 percent believed the global economy would decline further in 2012.

“This year confidence levels really have fallen off in a very significant way all across the world,” said Dennis Nally, chairman of PwC International Ltd.

Some 34 percent of respondents said they expected no change this year while just 15 percent predicted an improvement. Three percent were undecided.

Among the biggest concerns cited by CEOs were the European debt crisis and its effect on the global economy.

Unsurprisingly, company heads in Western Europe were gloomiest about the future. “They are not feeling real good,” Nally said. But confidence has plunged elsewhere, too, as executives worry that Europe’s woes could drag the rest of the world into a downward spiral, he said.

“The one thing that this financial crisis has really demonstrated to all of us is how interconnected the global economy really is.”

Even China, which still enjoys healthy economic growth, saw the share of CEOs who were “very confident” fall from 72 percent last year to 51 percent.

While chief executives in the United States were also cautious, some 41 percent said they were upbeat about short-term growth despite concerns about the US debt ceiling and gridlock in Washington ahead of the presidential elections this fall.

“It really does suggest that maybe the US economy is better or stronger than what some believe,” said Nally, adding that American companies had grown used to being patient with policy makers in an election year.

“Europe is really a short-term issue though,” he said. “I don’t think you have 12 months to keep this debate going on how to deal with the debt crisis.”