Finance professionals see slow recovery for global economy

Published: 2009/05/02

FINANCE professionals are forecasting a slow recovery for the world economy, according to new research published yesterday by the Association of Chartered Certified Accountants (ACCA) in its first Global Economic Conditions survey.

The survey of 805 ACCA members from 80 countries warns of a slow and credit-constrained recovery, which may see some of the major economies in stagnation.

The findings suggest that confidence has been lost in sectors and countries once the engine of world economic growth and the resulting decline in demand and supplier credit may be causing much greater damage than the banking sector's new-found aversion to risk, the ACCA said in a statement.

According to the survey, the contraction in world trade has come as a shock to professionals in the Asia-Pacific, especially China, who have lost more confidence than their Western colleagues.

Despite this, accountants in emerging markets and the developing world are expecting the global economy to bounce back sooner, with African countries such as Botswana, Zambia, Ghana and Kenya having the most optimistic respondents.

The research also shows that hopes of an early recovery are underpinned by trust in governments' response to the crisis. But business needs to play a part, too.

One respondent, a director at a US-based global human resource consulting firm, explained: "The government can be a catalyst, but the corporations have to act."

The report also shows that some respondents are seeing genuine opportunities in the downturn, and they're not all about cost-cutting. Accountancy practices can focus on niche markets, small businesses and the public sector can improve quality standards, while large corporates can enter new markets.

"There is a wide range of responses to the global downturn, showing that businesses are open to new paths to innovation, new business models and investing in future profitability. This is where policymakers come in: businesses need the policies and government support to help make these things happen," said Tay Kay Luan, ACCA's regional director for Asean and Australasia.