Singapore finance professionals are the world's most optimistic - despite growing concerns about global recovery, ACCA survey shows

Online, June 23, 2010 (Newswire.com) - The threat posed by levels of sovereign debt and rising inflation to the global economic recovery has been highlighted in the world's largest regular survey of professional accountants. Despite growing concerns, the Global Economic Conditions Survey by ACCA recorded its first positive recovery index value in the second quarter of 2010 .

For the first time, majority of global respondents now believe that conditions are either improving or about to. Singapore leads the way in optimism, recording larger gains in business confidence than any other major ACCA market in Q2 2010.

The picture in Singapore
Despite growing concerns about the strength of the global economic recovery, Singapore finance professionals are more optimistic than their colleagues anywhere else in the world. Just over half of the Singapore sample (54%) reported rising confidence in Q2 2010, while only 17% reported falling confidence.

The latest survey saw improvements across ACCA's range of indicators, from demand and access to finance to late payment and business insolvencies. But the best news is that Singapore has become, alongside China, one of the first major ACCA markets to record a net increase in business investment. This development is due to a strong improvement in access to finance for investment, as well a mild net increase in the number of profitable investment opportunities. Finally, Singapore also seems set to become the first major ACCA market to record a net increase in employment in the next quarter.

The Global Picture
While more members worldwide are now optimistic about economic prospects, a significant percentage of the 2,200 finance professionals responding to the survey continue to have doubts about the apparent improvements.

Manos Schizas, Senior Policy Adviser with ACCA, said: "Nearly a third of all respondents are now reporting problems with an increase in operating costs, with small businesses and not-for profit organisations hardest hit. These cost pressures are most keenly felt in Africa, South Asia and Asia Pacific.

"The slowdown in Asia has continued for a second consecutive quarter, and Africa, which had been performing strongly until recently, now appears to be following suit. ACCA believes much of this slowdown is down to a weak recovery in Europe and the US and to monetary contraction in China, which has now continued for two quarters in a row," he said.

The recovery in Western Europe, which had stalled in early 2010, has now gone into reverse as fears about sovereign debt and the future of the Eurozone weigh on finance professionals' minds.

Although investment is still low, business investment bounced back faster in the second quarter of than at any time since the downturn began, driven by both increased investment opportunities and improvements in the supply of finance.

But the survey shows that time may be running out for business people to capitalise on the conditions created by the downturn - with business opportunities appearing to have peaked in the third quarter of 2009.

"What has been noticeable is the way in which the developed and developing world has responded to the challenge. Respondents in the developing world are increasingly identifying pure value-added opportunities for their organisations or clients while their colleagues in the developed world are increasingly identifying cost-cutting opportunities instead," said Manos Schizas.

"The survey has also revealed that different sectors of the global economy are recovering at different rates. It is particularly telling that confidence is falling among public sector accountants, both in developed countries, where confidence never really recovered from the financial crisis of 2008-9, and now in the developing world, where concerns are growing as the recovery loses pace," he said.

The full report can be accessed on the following link :
http://www.accaglobal.com/pubs/general/activities/library/other_issues/surveys/tech-ms-gec06.pdf