Geopolitical Tensions, Rising Costs Threaten Global Growth Outlook: ACCA-IMA Survey

Geopolitical instability, rising energy rates and persistent cost pressures are emerging as key risks to global economic expansion, 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.

Key points

• Geopolitical instability was identified as the leading risk by 24.1% of finance professionals surveyed in Asia-Pacific, compared with 18.4% globally.
• Cost pressures remain elevated, with 62% of Asia-Pacific respondents reporting higher operating costs in Q3, compared with the survey's long-term average of 52%.
• While almost half anticipated higher interest rates over the next three months, up from 42% in Q2, globally, almost 70% of accountants noted rising operating costs.
• ACCA Chief Economist Jonathan Ashworth remarked Asia-Pacific's economic indicators remained encouraging, with the region benefiting from the global artificial intelligence (AI) investment boom.
• Nevertheless, confidence among accountants in the region fell sharply during the quarter, reversing almost three-fifths of the rise recorded in Q2.

For context, the Global Economic Conditions Survey (GECS) for the third quarter of 2026 demonstrates that the Asia-Pacific New Orders Index improved for the second consecutive quarter, approaching its highest level in the survey's history. Capital expenditure and employment indicators additionally strengthened, moving towards their historical averages.

Nevertheless, confidence among accountants in the region fell sharply during the quarter, reversing almost three-fifths of the rise recorded in Q2. While confidence remained slightly above its long-term average, renewed geopolitical tensions and higher energy rates may have contributed to the decline.

Geopolitical instability was identified as the leading risk by 24.1% of finance professionals surveyed in Asia-Pacific, compared with 18.4% globally. Talent and skills shortages, alongside supply-chain disruptions, were additionally cited more frequently in the region than worldwide.

Cost pressures remain elevated, with 62% of Asia-Pacific respondents reporting higher operating costs in Q3, compared with the survey's long-term average of 52%. Meanwhile, 41% expect interest rates in their respective countries to rise over the next three months, up from 30% in Q2 and 24% in Q1.

ACCA Chief Economist Jonathan Ashworth remarked Asia-Pacific's economic indicators remained encouraging, with the region benefiting from the global artificial intelligence (AI) investment boom. Nevertheless, he cautioned that further increases in energy costs and the projected impact of a powerful El Niño weather event posed downside risks. A significant slowdown in AI investment could additionally weigh on expansion.

As AI investment backed expansion while higher energy costs, inflation and administration bond yields created mounting pressure, alain Mulder, Senior Director, Europe Operations and Global Special Projects at IMA, remarked the global economy was being pulled in opposing directions.

Notably, the survey warns that sustained cost increases could force businesses to pass higher costs on to consumers, weaken demand and rise the likelihood of further interest-rate hikes by major central banks. Stay Connected with ProPakistani.

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For now, geopolitical Tensions, Rising Costs Threaten Global Growth Outlook: ACCA remains the part of the story worth watching, and further updates are likely as more details are confirmed.