GLOBAL RESULTS NEWS RELEASE: Confidence remains very high, despite a marginal decline from Q1 - but regional variances point to ongoing economic uncertainty
Professional accountants have reported a buoyant return to economic stability in Q2 2021, finds the latest edition of ACCA (the Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants) Global Economic Confidence Survey (GECS).
Over 1,100 global respondents, who are members of ACCA and IMA, report an upturn in key global activity indicators, such as orders – the proxy for real economic activity. The biggest gain in Q2 came in North America, powered ahead by a massive US fiscal stimulus.
The two ‘fear’ indices – measured by concerns that customers and suppliers may go out of business – both declined in this latest survey, confirming that the extreme uncertainty created by the Covid-19 crisis has fallen back towards more normal levels.
However, despite this optimism, stark warning signs remain due to wide regional variations in confidence, with large increases across Europe, contrasting with significant falls in Asia Pacific and South Asia. As a result, ACCA and IMA ask governments and policymakers to ensure this divergence does not grow.
Michael Taylor, chief economist ACCA, says: ‘These changes reflect the speed at which vaccinations are taking place in Europe while increased Covid-19 infections are happening again in Asia Pacific and South Asia. A key theme of this GECS is the divergence in economic prospects between advanced and emerging market economies. This needs to be tackled urgently.’
Helen Brand, chief executive of ACCA, adds: ‘The world economy’s recovery to its pre-pandemic size has been driven by rapid growth in the US and China, the two biggest economies. There are many jurisdictions with plenty of ground to still make up. But the difference we see between advanced and emerging markets is glaring – and action is needed on vaccines so that there are no shortages in emerging economies.’
Raef Lawson, Ph.D., CMA, CPA, IMA vice president of research and policy, noted that for 2021, global Gross Domestic Product (GDP) growth is likely to approach 6%, an exceptionally strong rebound after the 3.5% fall last year. This growth will be concentrated in advanced economies where levels of vaccination are now such that social distancing restrictions can be relaxed and economic conditions return to normal. Raef Lawson says: ‘This is a global pandemic, which needs global action to safeguard the health of populations and their economies – in the short and long term. For IMA and ACCA, there is a clear link in doing this to the UN SDGs, specifically Goal 1 to end poverty everywhere and Goal 8 decent work and economic growth.’
Key findings from GECS Q2 2021 reveal:
Michael Taylor concludes: ‘Looking ahead, health and economic risks are considerable, especially if a vaccine resistant variant emerges and spreads, forcing renewed lockdown measures with consequent economic harm. Policy-wise, it’s important that fiscal support is not withdrawn prematurely, potentially causing a setback to recovery in private demand.’
GECS can be found here: https://www.accaglobal.com/gb/en/professional-insights/global-economics/gecs-q2-2021.html
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About ACCA: ACCA (the Association of Chartered Certified Accountants) is the global professional body for professional accountants.
We’re a thriving global community of 233,000 members and 536,000 future members based in 178 countries and regions, who work across a wide range of sectors and industries. We uphold he highest professional and ethical values.
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About IMA® (Institute of Management Accountants): IMA® 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) and CSCA® (Certified in Strategy and Competitive Analysis) programs, continuing education, networking, and advocacy of the highest ethical business practices. Twice named Professional Body of the Year by The Accountant/International Accounting Bulletin, IMA has a global network of about140,000 members in 150 countries and 350 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.