The global economic recovery is over, according to the findings of the latest survey of accountants and other finance professionals.
According to the recent Global Economic Conditions Survey, the worldwide bounceback has met a wall and is stuttering. It has shown that confidence among businesses fell in the second quarter of the year, suggesting a risky future could be ahead.
That is the opinion of the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA). Both bodies have said that the results of their jointly commissioned survey are increasingly showing business confidence to be reliant upon stable finances.
Negligible change
Overall, the indicators in the survey would suggest a negligible change in the confidence of businesses, but the relative stability in the worldwide market is, according to ACCA and the IMA, cancelling opportunities out.
The appetite for investment is back though, with outsourced accountancy services helping many firms develop merger and acquisition plans.
Capital spending is particularly marked in South East Asia and North America, with the markets there said to be far more dynamic than across the Middle East, Africa and Europe. Central and Eastern European markets are also buoyant, but Western Europe’s relative retardation is offsetting progress here somewhat.
Back in the Red
A big concern is that many of the emerging markets are still not performing as well as had been hoped and, more poignantly, forecast. Growth capital access for firms is becoming harder to isolate here, though accounting professionals in key areas are making inroads where possible.
China remains a bright spot still, however, with its slowing economy recovering again. Russia too has had a surprisingly successful last quarter. Despite tensions in the former Communist state, a number of trade deals in the long term and key investments have had an effect.
On the other hand, Western banks have not a good first half to the year, with the introduction of harder stress tests, geopolitical unrest, and market fluctuations. Increased levels of corporate and global governance have also had – and will continue to have – a major-scale impact.
A senior economic analyst for ACCA, Manos Schizas said:
“After a year of solid improvement in 2013, it’s clear that 2014 is not going to be anywhere near as benign for the global economy.”
“The Chinese slowdown, which has been a constant drain on the global recovery, may be coming to an end, but the looming geopolitical risks in Eastern Europe and the Middle East are likely to prove just as damaging in the medium term.”