New ACCA and IMA Survey: Global Confidence Falls Sharply Amid Growing Trade Tensions; Confidence in the U.S. on the Wane and Lowest Since First Quarter of 2016

Taylor Fenske
Stern Strategy Group
(on behalf of IMA)
(908) 325-3866

Jeff Simmons
Anat Gerstein, Inc.
(on behalf of ACCA US)
(917) 673-0024

New York and Montvale, N.J., October 11, 2018 – The latest Global Economic Conditions Survey (GECS) from ACCA (the Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants) released today has revealed global economic confidence fell in the third quarter of 2018, its lowest since the beginning of 2016. The report predicted that global growth will slow gradually over the next several years largely due to weaknesses in the world’s two biggest economies, the United States and China.

GECS is the largest regular economic survey of accountants around the world, in terms of both the number of respondents and the range of economic variables it monitors. You can read the full report here or at The survey found:
  • While confidence fell by 20 points, it held up best in South Asia and Western Europe with falls of 2 and 6 points, respectively.
  • In both key regions of North America and Asia Pacific, confidence fell by over 20 points; in Asia Pacific, confidence is at its lowest since the start of 2016, and in North America, it is the lowest since the start of 2017.
  • Confidence in the Middle East and Africa also fell sharply by 35 and 22 points, respectively.
  • Globally, 45 percent of businesses have considered a number of responses to a change in economic circumstances, such as cutting staff numbers or introducing a hiring freeze.
  • Only 18 percent of businesses are considering increasing staffing levels – a drop by 2 percent in the last quarter.
Meanwhile, the U.S. economy has performed strongly since the last presidential election and has been a key driver of global economic growth. Confidence in the United States is now at its lowest level since the first quarter of 2016, which corresponds to the latest hard activity data that show the country’s growth starting to ease following a very strong second quarter.

“There are questions around how long this period of strong growth will last. The last time the economy was in recession – officially defined as two consecutive quarters of negative growth – was in Q2 2009; the current period of expansion is the second longest since the Second World War,” said Warner Johnson, Head of ACCA USA. “The most likely outcome for the U.S. is a gradual slowdown in growth over the next couple of years.”

Raef Lawson, Ph.D., CMA, CSCA, CPA, IMA vice president of research and policy, said, “Ten years after the collapse of Lehman Brothers, which marked the start of the deepest global downturn since the great depression, the risk of something similar occurring in the near future appears low,” Lawson said. “There has been a sharp reduction in the amount of risky lending, including the sub-prime mortgages that triggered the crisis 10 years ago. The Dodd-Frank Act in the US and the creation of the Prudential Regulation Authority in the UK, as well as the Basel III regulations that require banks to hold more capital, have made banking sectors across the developed world much safer. And while there are worries about property prices rising too quickly in some countries, these concerns are mostly focused on relatively small economies such as Hong Kong and Australia.”

The survey notes that the stimulating effect of recent tax cuts which have boosted corporate profits and investment will wear off over the course of the next few quarters. But interest rates are likely to remain relatively low over the coming years, and any further hikes will be contingent on the economy’s continued strong performance.

Meanwhile, although the trade war with China will cause some disruption for U.S. companies operating there, the macroeconomic impact is likely to be modest–as long as it does not escalate dramatically. Gross Domestic Product (GDP) growth reached 4.2 percent quarter on quarter in Q2 2018, the fastest since Q3 2014.

Although the U.S. employment index has plunged, it remains positive, reflecting the continued health of the U.S. jobs market. The country’s unemployment rate is at its lowest since 2000, and the economy continues to generate about 200,000 new jobs per month. Wages, meanwhile, grew by 2.9 percent in annual terms in August, the fastest rate of growth in nine years. The government spending component fell again in Q3 and is now well-below the high it reached in Q1 2018. The tax cuts of 2017 have opened up a hole in the U.S. fiscal deficit that will need to be closed, potentially with spending cuts to Medicare, the report notes.

However, the survey notes other risks elsewhere in the world economy, with the largest in China (which is witnessing a sharp rise in private sector debt) and Italy (which is witnessing a sharp increase in government debt).

Fieldwork for the Q3 2018 GECS took place between and 2018, and attracted responses from 925 ACCA and IMA members around the world, including 89 CFOs.

About ACCA
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants, offering business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.

ACCA supports its 208,000 members and 503,000 students in 179 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 104 offices and centers and more than 7,300 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.

ACCA is currently introducing major innovations to its flagship qualification to ensure its members and future members continue to be the most valued, up to date and sought-after accountancy professionals globally.

Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. More information is here:

About IMA® (Institute of Management Accountants)
IMA®, named 2017 and 2018 Professional Body of the Year by The Accountant/International Accounting Bulletin, 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) program, continuing education, networking and advocacy of the highest ethical business practices. IMA has a global network of more than 100,000 members in 140 countries and 300 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