Accountancy experts say economic confidence in Q1 has capitulated as the Pakistani economy struggles to get to grips with the fallout from the Coronavirus.
A national survey of senior accountancy practitioners, who reflect the outlook of a large number of businesses they advise, found that confidence has fallen by more than 5% to -28, a record low for Q1 registered in the 11-year history of the research.
The report Global Economic Conditions Survey (GECS), jointly published by ACCA (Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants) reveals:
- Global confidence fell to its lowest level on record with big falls in all regions
- The global orders index, which tends to be less volatile than confidence, also fell sharply
- Pakistan employment and investment tumble to record lows
- Pakistan set to suffer a sharp economic contraction in coming months
Michael Taylor, the chief economist at ACCA, revealed there was a relatively little divergence in confidence between regions owing to the global nature of the coronavirus economic shock.
He said: ‘Pakistan economic sentiment is in line with the rest of the world. Confidence fell everywhere and, in most cases, sharply and to the lowest since the survey began in 2009.
‘South Asia, Pakistan in particular, did not show a collapse in confidence in early March. Pakistan was suffering from weak growth prior to the pandemic and will quickly fall into economic contraction.
‘While this survey looks at the economic impact, it is important to remember there is a human cost both now and in the long-term on wellbeing, skills and the risk of redundancy.’
Looking ahead, Michael Taylor concludes: ‘The economic damage in the coming months will be huge. But if appropriate policy action is taken, then conditions for recovery will be in place when the COVID-19 health crisis is substantially over.’
GECS Q1 2020 can be found online at: https://www.accaglobal.com/gb/en/professional-insights/global-economics/GECS_Q1_2020.html