Nigerian Economic Confidence Falls By 3% In 12 months — ACCA

A report from a prestigious Accounting body, the Association of Chartered Certified Accountants (ACCA) and Institute of Management Accountants (IMA) has revealed that Nigerians’ confidence in the economy fell by 3.0 percent in 12 months ending December 2018.

Meanwhile, the ACCA also projected that the country’s economy would grow by 2.0 to 2.5 percent in the year 2019. The survey report titled: “Global Economic Conditions (GECS)” stated: “The poor near-term outlook for Nigeria is reflected in our GECS score, which shows confidence fell in the final quarter of 2018 and is now at its lowest level in a year.

The recent fall in oil prices will weigh on exports and government revenues. While the non-oil economy has been improving, consumer demand is soft, restrained by a 23 percent unemployment rate. Overall GDP growth this year is likely to be very modest at between 2 percent to 2.5 percent.”

But Nigeria is not the only country in the low ratings, they also imagined that major economies would suffer some setbacks. It therefore stated: “The global poll of 3,800 accountants shows that all key regions recorded a negative confidence score with signs of growth weakening in the world’s three biggest economies – the US, China and the Eurozone. Global economic confidence fell for the third consecutive quarter in the fourth quarter of 2018 (Q4’18), ending the year at an all-time low.”

The report revealed: “rising cost was the biggest concern for respondents, with 55 percent citing this as an issue, 47 percent of respondents globally are considering laying off staff, with just 18 percent considering taking on new workers, 39 percent of respondents are considering scaling back investment in new capital projects, compared with just 16 percent who are looking to increase investment in new projects and the possibility of suppliers going out of business being a concern for just 12 percent of respondents, unchanged from Q3”.

While Commenting on the development, the Head ACCA, Nigeria, Mr Thomas Isibor, said: “The report discovers that despite an improvement in the non-oil sector of economy, consumer demand is soft, restrained by a 23 percent unemployment rate. Overall GDP growth in 2019 is likely to be very modest at between 2 percent to 2.5 percent.

The Head of Business Insights, ACCA, Narayanan Vaidyanathan, noted that “Economic confidence over 2018 has been turbulent, with end of calendar year results downbeat compared to the start of 2018. It’s been interesting to look back at the GECS from the start of 2018, when we recorded economic confidence at its highest since the first survey was issued assessing Q1’ 2009. Last year was clearly a roller-coaster ride and the outlook for 2019 is also uncertain.”

The Q4’18 survey took place between 23 November and 7 December 2018 and attracted 3773 responses from ACCA and IMA members around the world, including 302 Chief Financial Officers (CFOs).