Irish economic confidence grows once more, amid turbulent 2018 with global pessimism at record low

ACCA and IMA issue latest edition of Global Economic Conditions Survey (GECS) for Q4 2018

  • 3% rise in Q4 confidence in Irish economy, adds to 9% rise in Q3
  • Q4 confidence score compares with 16.3% drop in UK score across same period
  • Western Europe confidence drops and global economic confidence at record low

Economic confidence in Ireland has continued to grow for the second successive quarter in Q4 2018, despite global uncertainty uncovered in the latest edition of Global Economic Conditions (GECS) from ACCA (The Association of Chartered Certified Accountants and IMA (Institute of Management Accountants).

The poll of 171 Irish accountants showed a surprising pick-up in confidence, given Ireland’s exposure to the UK and that it would be one of the hardest-hit economies in the event of a hard Brexit.

Caitriona Allis, head of ACCA Ireland, comments: ‘The latest GECS report found strong economic performance in Ireland, owing to a buoyant consumer sector, strong employment market and rapid wage growth. This picture compares against favourably with the UK, which saw confidence fall sharply, so it is now at a record low since GECS began in 2009. Uncertainty over Brexit reached extreme levels and affected economic activity and confidence with business investment now on a declining trend.’

Globally, economic confidence fell for the third consecutive quarter in Q4 2018, ending the year at an all-time low. From the 3,800 accountants surveyed around the world, results show that all key regions recorded a negative confidence score with signs of growth weakening in the world’s three biggest economies - the US, China and the Eurozone.

The survey highlighted pessimism among respondents about the outlook ahead, with the lowest scores recorded in Western Europe and the Caribbean. The least pessimistic part of the global economy was again South Asia, followed by Africa and North America.

Narayanan Vaidyanathan, head of business insights at ACCA said of the global results: ‘Economic confidence over 2018 has been turbulent, with end of calendar year results downbeat compared to the start of 2018. It’s been interesting to look back at the GECS from the start of 2018, when we recorded economic confidence at its highest since the first survey was issued assessing Q1 2009. Last year was clearly a roller-coaster ride and the outlook for 2019 is also uncertain.’

GECS Q4 shows:

·         The biggest concern for respondents was again rising costs, with 55% citing this as an issue.

·         47% of respondents globally are considering laying off staff, with just 18% considering taking on new workers.

·         39% of respondents are considering scaling back investment in new capital projects, compared with just 16% who are looking to increase investment in new projects

·         The possibility of suppliers going out of business being a concern for just 12% of respondents – unchanged from Q3.

Narayanan Vaidyanathan, head of business insights at ACCA said of the global results: ‘Economic confidence over 2018 has been turbulent, with end of calendar year results downbeat compared to the start of 2018. It’s been interesting to look back at the GECS from the start of 2018, when we recorded economic confidence at its highest since the first survey was issued assessing Q1 2009. Last year was clearly a roller-coaster ride and the outlook for 2019 is also uncertain.’

GECS Q4 2018 can be found online: https://www.accaglobal.com/gb/en/professional-insights/global-economics/gecs-q4-2018.html

Fieldwork for the Q4 survey took place between 23 November and 7 December 2018 and attracted 3773 responses from ACCA and IMA members around the world, including 302 CFOs.

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About ACCA

ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants, offering 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.

ACCA supports its 208,000 members and 503,000 students in 179 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 104 offices and centres and more than 7,300 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.

ACCA is currently introducing major innovations to its flagship qualification to ensure its members and future members continue to be the most valued, up to date and sought-after accountancy professionals globally.

Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. More information is here: www.accaglobal.com

About IMA® (Institute of Management Accountants)

IMA®, named 2017 and 2018 Professional Body of the Year by The Accountant/International Accounting Bulletin, 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 100,000 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/India. For more information about IMA, please visit www.imanet.org.

"The latest GECS report found strong economic performance in Ireland, owing to a buoyant consumer sector, strong employment market and rapid wage growth. This picture compares against favourably with the UK, which saw confidence fall sharply, so it is now at a record low since GECS began in 2009. Uncertainty over Brexit reached extreme levels and affected economic activity and confidence with business investment now on a declining trend."

Caitriona Allis, head of ACCA Ireland - ACCA