KPMG has published its annual enterprise barometer which shows Welsh business owners are more positive on growth than the UK as a whole.

Nearly nine in 10 (89%) businesses in Wales are confident about growth this year, according to new research from professional advisory firm. KPMG. Its annual private enterprise barometers shows confidence over growth amongst Welsh firms is 2% higher than the UK average of 87%.

Increased demand for products and services was identified as the main reason for the outlook, cited by 43% of Welsh businesses, while 42% highlighted plans to introduce new technology as another reason for optimism in the year ahead. Technology also dominated as a leading investment priority for Wales-based businesses, with 39% identifying areas such as digital transformation as a key investment focus, followed closely by investment in artificial intelligence (38%), both in line with the UK averages.

Diversification is also high on the agenda for private businesses across Wales, with more than half of businesses (57%) looking to introduce new service lines and broaden their client offering.

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Appetite for internationalisation is high, with 63% confirming that appetite for international expansion has grown in the last 12 months. 56% of respondents are also targeting new markets as a way to diversify over the next five years. Western Europe was identified as the most favoured location for expansion and trade amongst Wales businesses, with 53% citing the region as a priority.

The appetite for alternative funding options is strong, with nearly half (47%) of regional businesses now open to private equity investment, in line with the UK average. This reflects a willingness amongst firms to explore new sources of capital to support innovation and accelerate growth.

On merger and acquisitions more broadly, 41% are open to opportunities but not actively seeking them. 36% are focused on internal growth only, while a further 28% are actively pursuing acquisitions.

David Williams, Wales and south west regional office senior partner at KPMG UK, said: “Wales’ impressive confidence heading into 2026 puts it near the top of the leaderboard for this year’s survey. This optimism is being driven by real demand for products and services, combined with strategic investment in tech and diversification.

“More broadly, it’s a pivotal moment for Wales. Major investment and projects like the Celtic Freeport are creating genuine momentum. And businesses are responding by positioning themselves to capitalise.

“Ambition to enter new markets is particularly striking, with over half of respondents eyeing the prospect. Combined with Wales’ growing strengths in renewable energy and infrastructure development, these businesses can be seen to be actively building the capabilities to deliver sustained growth.”