Confidence among global accountants declines

KARACHI: Confidence among global accountants continued its downward trend in early 2025, according to the latest Global Economic Conditions Survey (GECS) from ACCA (Association of Chartered Certified Accountants) and IMA (Institute of Management Accountants), said a press release on Thursday.

While the Q1 decline was less severe than the drop seen in Q4 2024, confidence remains at its lowest since the early pandemic days of Q2 2020.

The survey, conducted from late February to mid-March, coincided with rising global economic uncertainty. It preceded a major US announcement on new import tariffs, which analysts warn could further dampen global economic prospects in the coming quarters.

North America experienced the most significant decline, driven largely by a steep drop in sentiment among US-based accountants. US confidence is now at its second-lowest level on record. Survey respondents cited concerns over the country’s shifting trade policies and reduced government spending. Both the US Capital Expenditure and Employment indices declined to historically low levels, although the New Orders Index showed some resilience with a modest increase.

In contrast, Asia Pacific saw a rebound in confidence following previous sharp declines. The region’s New Orders Index climbed to historically high levels, suggesting improved economic activity ahead. However, the outlook remains mixed -- while employment expectations rose above average, capital expenditure fell notably. China led the regional upswing, with a significant rise in confidence and improved new orders since Q3 2024. Still, analysts caution that recent export growth may reflect pre-tariff stockpiling, and escalating trade tensions with the US could threaten future stability.

Western Europe also recorded a rise in confidence after months of decline, despite ongoing concerns about the impact of US tariffs. Globally, cost pressures intensified, remaining especially high in Western Europe and increasing substantially in North America.

Jonathan Ashworth, chief economist at ACCA, noted: “Global growth has held up relatively well, but prolonged low confidence increases the risk of a negative feedback loop, with businesses cutting back on orders, investment and hiring.”

Senior Director at IMA Alain Mulder added: “Uncertainty over US trade and fiscal policies is weighing heavily on sentiment, alongside broader market declines and signs of economic slowing.”

Economy-related concerns topped the list of risks for accountants in Q1. In the US, geopolitical instability emerged as a growing concern, while cybersecurity and talent shortages topped risks in specific sectors such as financial services and the public sector.