Global economy can recover in next 18 months: Survey

THE Association of Chartered Certified Accountants (ACCA) believes the global economy could recover within the next 18 months, riding on growing trading confidence and actions of national governments.In a statement, the ACCA said according to a global survey of finance professionals, confidence was up but trading conditions were still tough and panic was no longer a major driver of the global economy.

"Optimism continues to depend substantially on the actions of national governments but the reliance on state assistance has dissipated since the quarter one survey and business confidence is now more clearly linked to expectations of future growth."ACCA director of technical policy and research Dr Steve Priddy said while there was little evidence of economic recovery, there was renewed confidence and optimism.

The ACCA Global Economic Conditions Survey for the second quarter of 2009 indicates that the loss of business confidence has slowed substantially and coming to a halt in key areas such as the Asia Pacific region and even reversing in key sectors such as small- and medium-sized enterprises and large financial services firms.

Sixty-four per cent of the finance professionals surveyed said they thought the global economy had bottomed out, twice as many who responded in the first quarter of 2009. More than a third of respondents now expect a recovery within the next 12 months.However, one in ten still expect the downturn to last three years or longer and this view is twice as common among public sector accountants.

On a regional basis, Western European finance professionals were more pessimistic about the recovery while African professionals were most likely to believe conditions were improving, albeit weakly.Respondents from Asia Pacific were more likely to think the worst was behind them and were expecting a speedier recovery.

The latest survey also asked finance professionals to predict what the global economy would look like following the credit crunch and respondents wants stricter and more pervasive regulation especially of financial institutions, tighter credit conditions and increased efficiency.

As organisations look inward for cost savings and more efficient ways of doing business, members also want stronger governance and internal business controls as consumers are expected to become cautious net savers. ACCA is the global body for professional accountants with 362,000 students and 131,500 members in 170 countries worldwide.