The Global Economic Conditions Survey (GECS) is presently the leading regular economic survey of accountants in the world, in terms of both the range of economic variables and the number of respondents that it had observed. Carried out jointly by ACCA and IMA (Institute of Management Accountants), GECS’s key indices are worthy predictors of GDP growth in several OECD countries and day-to-day trend deviations draw a parallel with the ‘fear ’index, which measures expected stock price volatility.
ACCA and IMA combined forces to conduct research in an effort to empower accountants and financial professionals to drive business performance. The study attracted 1772 respondents from both ACCA and IMA globally. 700 of those respondents were senior finance professionals including 171 CFOs. Business confidence and sentiment are on the rise despite mounting risks. Major GECS confidence and recovery indices both rose in early 2014, bringing global business confidence just short of positive territory for the first time in five years. 30% of respondents reported that they were more confident about the prospects of their organisations. However, 31% reported a loss of confidence, down from 34% in late 2013. Perceptions of macroeconomic conditions have improved faster than business confidence. In late 2013, more than half of the global GECS research sample (58%, up from 55%) were quite optimistic about the state of their national economies, reporting that a recovery period was underway or about to begin. The pessimists only made up 38% of the sample.
“Despite the pessimists, in theory, these are the best business confidence readings since the GECS began in 2009” – Karen Smal, Acting Head of ACCA South Africa
The survey continues to reveal positive reports. GECS states that business investment is on the rise again due to increased dynamism of businesses and innovation. This bodes well for the South African economy, which is reliant on foreign investment. South Africans should prepare for the upswing in global recovery to take advantage of the financial benefits once this upswing hits our shores.
The survey offers South African accountants and finance professionals a front-row seat to the global economic recovery. It reveals first-hand accounts of business conditions on the ground that makes the GECS a trusted barometer for the global economy.