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Confidence in global economy improves: WEF survey

Last Updated: Monday, January 21, 2013 - 22:43

Davos: The overall confidence in the global economy has improved in the first quarter of this year compared to last three months of 2012, according to a WEF survey.

The improved confidence has emerged amid positive signs from the debt-laden euro zone and hopes that worst fears about US debt turmoil would be allayed.

"The first Economic Confidence Index result of 2013 gives us some cause for optimism, but the figure is still in negative territory overall.

"We still need dynamic leadership to drive the economy ahead and overcome challenges," Martina Gmur, Senior Director of the Forum's Network of Global Agenda Councils, said.

The World Economic Forum's Economic Confidence Index rose to 0.43 in the first three months of this year from 0.38 recorded in the 2012 December quarter. On a scale of 0 to 1, the latest reading is "closer to optimistic territory of over 0.5".

This is the second highest level of economic confidence shown since the Index was started seven quarters ago.

WEF's latest Index readings are based on a survey of 390 experts from business, government, international organisations and academia who are members of the Forum's Network of Global Agenda Councils.

The improved confidence comes amid "some positive signs from the Eurozone and a sense that the worst fears for the US fiscal cliff debt crisis had been allayed," it said in a statement.

Noting that confidence in the state of world economy has recovered somewhat in 2013 first quarter, WEF said percentage of people fearing a major economic disruption for year ahead fell to 48 per cent from 53 per cent in December quarter.

"The number of respondents with a pessimistic ('not confident' or 'not at all confident') outlook for the economy in 2013 fell to 43 per cent from 56 per cent last quarter, while the percentage of optimists ('confident' or 'very confident') rose to 23 per cent from 17 per cent," WEF said.

The remaining 34 per cent were neutral.

According to WEF, other measures of confidence covered in the poll were stable.

"The percentage of respondents who expected major social, geopolitical, environmental or technological disturbances hovered at 46 per cent, 50 per cent, 35 per cent and 19 per cent, respectively.

"Expectations of the world's ability to deal with such threats remained stable... 51 per cent of respondents lacked confidence in global governance, and 45 per cent in global co-operation," the statement noted.

The Index has been released ahead of the WEF Annual Meeting whose theme is 'Resilient Dynamism'. More than 2,500 participants, including heads of states or governments, are expeccted to participate in the event.


First Published: Monday, January 21, 2013 - 22:43
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