Press release

7 Feb 2023 Singapore, SG

Asia-Pacific CEOs brace for severe but short downturn; adjust strategies to emerge stronger than competitors

SINGAPORE, 7 FEBRUARY 2023. Asia-Pacific CEOs are bracing for an economic downturn characterized by geopolitical tensions, supply chain disruption and ongoing COVID-19 related uncertainty.

Press contact
Gary Gan

EY Asia-Pacific Media Relations and Social Media Leader

Trusted leader and collaborator. Expert storyteller and occasional drummer.

  • 37% of respondents are halting planned investments due to geopolitics
  • 84% will look to leverage deals over the next 12 months to secure growth
  • Investment in innovation, tech and talent seen as ways to emerge stronger from the downturn

Asia-Pacific CEOs are bracing for an economic downturn characterized by geopolitical tensions, supply chain disruption and ongoing COVID-19 related uncertainty. This is according to findings of the latest EY CEO Outlook Pulse survey, which recorded the views of 1,200 CEOs across the globe on their prospects, challenges and opportunities.

In Asia-Pacific, almost all CEOs (99%) are actively planning for a downturn scenario, with a substantial majority (72%) preparing for a severe downturn in the region. Just over half of CEOs (54%) believe the downturn will be temporary. This sentiment is particularly apparent in China, where 83% of CEOs are planning for a downturn that is severe but shorter in duration.  Almost two thirds of Asia-Pacific CEOs (61%) are confident that fiscal and policy decisions will mitigate the worst impacts of a downturn and shorten its length. In contrast, the largest group (37%) of American CEOs polled believe that the downturn will be moderate in severity, but more persistent in in their primary market of operations. European CEOs are divided on the length, depth, and severity of the potential downturn.

For the first time since 2020 (inaugural CEO Outlook survey) restrictive regulatory, trade and investment policies (25%) have superseded COVID-19-related issues (19%) as the key reason for CEO respondents altering investment plans. As a result of these exacerbated geopolitical challenges, 98% of respondents are reviewing their plans with 37% delaying a planned investment and almost a third (32%) stopping planned investments altogether.

One third (33%) of respondents consider a sustained period of higher input prices and inflation and a regionalization of the global economy as the greatest risks to future growth for their business. While concerns over COVID-19-related uncertainty have receded in Asia-Pacific, almost a third of CEOs (29%) still cite this as a key risk to their business (down from 43% in October 2022).

Yew-Poh Mak, EY Asia-Pacific Strategy and Transactions Leader, says: 

“Whether long or short, Asia-Pacific CEOs are bracing for a severe downturn. Moving on from the previous fixation on pandemic-related risks, CEOs across Asia-Pacific are grappling with higher input prices and higher cost of capital, amidst rising inflation and regionalization of the global economy. With China rapidly easing COVID-19 measures and reopening to the world, inflation is expected to become more prominent. Fiscal and regulatory policy will be front of mind, as CEOs consider what levers to pull to navigate this slowdown.”

Asia-Pacific CEOs eye deals and investment in innovation, tech and talent as routes to growth

Despite the negative outlook, Asia-Pacific CEOs are keeping an eye out for strategic opportunities that may emerge from volatility to gain competitive advantage. Dealmaking remains a priority for the majority of respondents (84%) over the next 12 months with CEOs more inclined toward joint venture or strategic alliances (44%) compared to acquisitions (31%) and divestments (29%).  When pursuing a merger or acquisition target, the majority of CEOs (68%) say they will prioritize markets where their home country has a strong geopolitical and economic relationship.

To further shift the dial and emerge stronger and more competitive from the downturn, 41% of respondents are planning to increase investment in innovation and R&D, including product and service innovation and corporate venturing. In addition, more than a third (38%) plan to increase their investment in digital transformation initiatives centered around data and technology and 39% of respondents cited talent, including workforce wellbeing and skills development as a priority for further investment . The majority of CEO respondents (75%) agree that flexible working will be critical to reducing employee churn and attracting new talent, while 56% of respondents have already began shifting from hiring new talent to upskilling their existing workforces.

Mak said: “Asia-Pacific CEOs expect a short but severe recession and are sharpening their focus to ensure they are investing in the right bets and managing the fine balance between short-term profitability and long-term value creation. 

“Asia-Pacific CEOs see transactions as critical levers for future growth, though more are opting for joint ventures and alliances to mitigate the risks of major capital investments as economies slow. The main focus for transactions in 2023 will be on early-stage businesses to help CEOs enhance existing portfolios, access new talent or break into new markets. In addition, CEOs will continue to invest heavily in digital and technology transformation to deliver both revenue growth and leverage operational advantages

Mak added: “In the face of overwhelming adversity, it is tempting to go defensive – cut costs, stall investments, downsize, and survive. The start of 2023 offers signs that several key macroeconomic and geopolitical challenges may be abating. While new challenges will certainly arise, strategic and decisive leadership is needed from Asia-Pacific CEOs to steer their organizations through challenging times and emerge more resilient and better positioned than the competition.”

To read the full report, please visit:


Notes to editors

About EY

EY exists to build a better working world, helping create long-term value for clients, people and society and build trust in the capital markets.

Enabled by data and technology, diverse EY teams in over 150 countries provide trust through assurance and help clients grow, transform and operate.

Working across assurance, consulting, law, strategy, tax and transactions, EY teams ask better questions to find new answers for the complex issues facing our world today.

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Information about how EY collects and uses personal data and a description of the rights individuals have under data protection legislation are available via EY member firms do not practice law where prohibited by local laws. For more information about our organization, please visit

This news release has been issued by EYGM Limited, a member of the global EY organization that also does not provide any services to clients.

About the EY 2023 CEO Outlook Pulse

The EY 2023 CEO Outlook Pulse survey aims to provide valuable insights on the main trends and developments impacting the world’s leading companies as well as business leaders’ expectations for future growth and long-term value creation.

It is a regular “pulse” survey of CEOs from large companies around the world, conducted by Longitude Research Limited, a Financial Times company.

In November 2022, Longitude surveyed on behalf of the global EY organization a panel of 1,200 CEOs in 22 countries and across six industries. Respondents represented the following industries: advanced manufacturing and mobility, consumer products and retail, energy and resources, financial services, health sciences and wellness, technology, media and telecoms.

Surveyed companies’ annual global revenues were as follows: less than US$500m (20%), US$500m–US$999.9m (20%), US$1b–US$4.9b (30%) and greater than US$5b (30%).

The CEO Imperative series provides critical answers and actions to help CEOs reframe their organization’s future. For more insights in this series visit