ISLAMABAD: Geopolitical instability, rising energy prices and persistent cost pressures are emerging as major risks to global economic growth, despite resilient business activity and improving new orders in Asia-Pacific, according to a survey by the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA).
The Global Economic Conditions Survey (GECS) for the third quarter of 2026 showed that the Asia-Pacific New Orders Index improved for the second consecutive quarter, moving close to its highest level in the survey’s history. Capital expenditure and employment indicators also strengthened, moving towards their historical averages.
However, business confidence among accountants in the region declined sharply during the quarter, reversing almost three-fifths of the increase recorded in the second quarter. While confidence remained slightly above its long-term average, renewed geopolitical tensions and higher energy prices may have contributed to the fall.
According to the survey, geopolitical instability was identified as the leading risk by 24.1 per cent of finance professionals in Asia-Pacific, compared with 18.4 per cent globally. Talent and skills shortages, along with supply-chain disruptions, were also cited more frequently in the region than worldwide.
Cost pressures remained elevated, with 62 per cent of Asia-Pacific respondents reporting higher operating costs in the third quarter, against the survey’s long-term average of 52 per cent. Meanwhile, 41 per cent of respondents expected interest rates in their respective countries to rise over the next three months, compared with 30 per cent in the second quarter and 24 per cent in the first quarter.
Globally, nearly 70 per cent of accountants reported rising operating costs, while almost half expected higher interest rates over the next three months, up from 42 per cent in the second quarter.
ACCA Chief Economist Jonathan Ashworth said Asia-Pacific’s economic indicators remained encouraging, with the region benefiting from the global artificial intelligence investment boom. However, he warned that further increases in energy prices and the expected impact of a powerful El Niño weather event posed downside risks. He said a significant slowdown in AI investment could also weigh on growth.
Alain Mulder, Senior Director, Europe Operations and Global Special Projects at IMA, said the global economy was being pulled in opposing directions, as AI investment supported growth while higher energy prices, inflation and government bond yields created increasing pressure.
The survey warned that sustained price increases could force businesses to pass higher costs on to consumers, weaken demand and increase the likelihood of further interest-rate hikes by major central banks.
