A survey by finance professionals has revealed that the global economic recovery has slowed down again in early 2012, adding that there are fears that governments, which are already living beyond their means, may struggle to get it back on track through extra public spending.

A Global Economic Conditions Survey for the second quarter of 2012, undertaken by the Association of Chartered Certified Accountants and the Institute of Management Accountants, cautioned that growth across the world’s most developed economies had stalled once again and that the global economy was as fragile as it had ever been in the last three years.

The global survey of 2,700 professional accountants, now well into its third year, suggested that hints of a stronger recovery in early 2012 were mostly down to misplaced optimism, and that most of the gains made at the time had been reversed.

The Survey Editor and Senior Economic Analyst with ACCA, Mr. Manos Schizas, said, “The point now is to see how far and how fast the Chinese slowdown will travel. Our members in Africa tend to feel any fallout from Asia fairly quickly and there could be implications for other markets, which trade with China.”

According to the survey, the flip side of the Chinese slowdown is a recovery for the United States economy, where investment is on the rise and confidence is high, despite significant potential problems.

With growth faltering once again, the finance professionals surveyed by ACCA and IMA are rethinking their attitudes towards public spending.

It said, “The policy choice is not quite so simple. Accountants working in major markets, such as the US, China, Russia, Malaysia, or Pakistan – economies relied on by others for trade and export opportunities – believe that fiscal stimulus by their governments is already unsustainable. It was in only a few markets that respondents believed that their governments could spend both robustly and sustainably – places such as Singapore, or the UAE.”

Source: Punch/Ademola Alawiye