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Nearly three quarters of businesses are facing increased costs, the highest proportion of respondents reporting increased cost pressures for the last decade, according to the latest edition of the Global Economic Conditions Survey (GECS) from ACCA and the IMA (Institute of Management Accountants).
Over one in three respondents were worried about decreased income, while others highlighted foreign exchange volatility, as “uncertainty and glimpses of recession dominate the latest economic outlook”.
There was an increase in the number of respondents reporting “problems securing prompt payment,” which has risen to the highest level in four years. According to ACCA, this could be the first sign of an increase in the number of organisations that may be experiencing cash-flow difficulties. There was also a “noticeable” rise in the numbers reporting “problems accessing finance”.
ACCA said the data also showed that confidence on the economic outlook remained “well below” the median reading over the past decade, while the other three indicators that are more closely related to economic activity – new orders, capital expenditure, and employment – all showed a further deterioration.
Jamie Lyon, head of skills, sectors and technology at ACCA, said: “Our latest Global Economic Conditions survey points to obvious ongoing challenges in the global economy, a reflection of the continued economic fallout from the Russian invasion in Ukraine, a further tightening of monetary policy in key jurisdictions and a cost of living crisis.
“One of the key risks will be how much and how quickly central banks will seek to further tighten monetary policy in the months ahead to tame inflationary pressures, and whether or not the global economy could slow more than business leaders expect in 2023.”
Loreal Jiles, vice president of research and thought leadership at IMA, added: “For most regions in the world, the GECS survey points to a decline in business orders both in comparison to the previous quarter, and looking across the new orders index over the past year. Coupled with inflationary pressures, it suggests a challenging time for businesses ahead in the next few months.”
