China panic over, but volatile global economy means nervousness in Asia pacific remains, says major new economic conditions survey from ACCA
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Business confidence in Asia Pacific picked up sharply in Q2 though businesses in the region still nervous about future prospects. Dip in confidence across the OECD linked to Brexit uncertainty, which is set to continue as the UK commences a complex multi-year process to extricate itself from the EU. OECD woes partially offset by improvements elsewhere with China looking less likely to suffer a large currency devaluation, and the US enjoying healthy consumer confidence and unemployment figures.
The latest Global Economic Conditions Survey (GECS) released today by ACCA (the Association of Chartered Certified Accountants) and IMA (the Institute of Management Accountants), offers an early indication of how uncertainty will effect OECD economies, with business confidence subdued despite an improving global outlook. Responding to the findings, Reuter Chua, head of ACCA Singapore said:
“Business confidence has picked up encouragingly in Singapore over the last three months. This has been led by much stronger sentiment in China, where the sense of crisis that dominated the second half of 2015 has now faded.”
Although the survey findings show things are improving slightly, Reuter Chua has warned that Singapore is not out of the woods yet;
“Now is not the time for complacency. Although we are seeing a pickup in confidence, businesses in Singapore are undoubtedly still nervous about the future. Almost half (47%) of those we asked reported cuts in capital expenditure and declining orders (42%) while most worryingly of all, 60% told us they were in the midst of a hiring freeze.”
According to Reuter Chua, the situation is unsurprising given the current volatility across the global markets;
“Global trade is hugely important to Singapore, and across the whole of the Asia Pacific region. Along with Hong Kong and Malaysia, we are among the most open economies in the world. It is no surprise therefore that the current events worldwide will impact on the confidence of businesses here.”
In fact, Reuter Chua anticipates the potential impact of global events such as Britain’s decision to leave the European Union will be felt globally for the foreseeable future;
“It would not be a surprise if business sentiment falls in Q3. The potential for long-term uncertainty as the UK negotiates its complex departure from the European Union could weigh down on global confidence for some time to come. It is important that the UK Government acts fast to come up with a plan for its trade links across the world.”
Fieldwork for the Q2 2016 GECS took place between 3 and 20 June before the Brexit referendum, and attracted more than 1,200 responses from ACCA and IMA members around the world, including more than 130 CFOs. Nearly half the respondents were from small and medium enterprises, with the rest working for large firms of more than 250 employees.
The full report can be downloaded here: http://www.accaglobal.com/uk/en/technical-activities/technical-resources-search/2016/july/global-economic-conditions-survey-report-q2-2016.html.
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For media enquiries, contact:
Jeffrey Wong / Vylvianne Devajothi
The Hoffman Agency Singapore
Tel: +65 6361-0250 +65 6361-0250
Email: ACCA@hoffman.com
Shermeen Ching
ACCA Singapore
Head of Marketing
Tel: +65 6637 9197 +65 6637 9197
Email: shermeen.ching@accaglobal.com
Notes to Editors
About ACCA
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We support our 178,000 members and 455,000 students in 181 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of 92 offices and centres and more than 7,110 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
About IMA® (Institute of Management Accountants)
IMA®, the association of accountants and financial professionals in business, is one of the largest and most respected associations focused exclusively on advancing the management accounting profession. Globally, IMA supports the profession through research, the CMA® (Certified Management Accountant) program, continuing education, networking and advocacy of the highest ethical business practices. IMA has a global network of more than 80,000 members in 140 countries and 300 professional and student chapters. Headquartered in Montvale, N.J., USA, IMA provides localized services through its four global regions: The Americas, Asia/Pacific, Europe, and Middle East/Africa. For more information about IMA, please visit www.imanet.org.