The first findings of the annual Grant Thornton International
Business Owners Survey (IBOS), published today, show a
significant swing to optimism about the economy among
business owners in 26 countries across the world. India
tops the league table in being the most optimistic country
with an optimism/pessimism balance (*see note below) of
+83%, perhaps reflecting the current buoyant industrial
performance and a good monsoon season. Following close
behind is Australia (+81%), where the economy continues
to be on an economic roll, and the US (+75%). This reflects
the spectacular performance of the US economy with annualised
2003 third quarter growth of more than 7% at the time
of the survey – the strongest for 20 years. South
Africa and Canada follow closely behind.
Although more optimistic than last year, Eurozone countries
are much slower in anticipating a recovery. Five out of
seven Eurozone countries in the survey – Germany,
France, Netherlands, Italy and Ireland – are in
the top ten most pessimistic countries in the world. Germany
is the most pessimistic with an optimism/pessimism balance
of –6%. Two non-Eurozone countries, the UK and Sweden,
are optimistic, with balances of +49% and +24% respectively.
The UK and Spain, which also has a balance of +49%, are
the most optimistic European countries.
* Grant Thornton 2004 International Business Owners
Survey, figures are the % balance between optimistic and
pessimistic
Structural economic problems have kept Japan at the bottom
of the table for the second year running with a balance
of –46%, although this is significantly more optimistic
that last year's balance of -71%. The picture across Asia,
however, is mixed. There has been a dramatic swing to
optimism in Hong Kong – from a balance of –30%
last year to +51% - perhaps indicating that the economy
may be turning the corner. Pakistan, Indonesia and Taiwan
are also positive but the Philippines and Singapore remain
pessimistic. Singapore is the only country in the survey
to become more pessimistic this year and, unlike Hong
Kong, appears to have been unable to shake off the repercussions
of SARS.
Said Michael Rogerson, partner: “Overall the results
paint a much better economic picture than this time last
year with an optimism balance of +39% compared to +3%
twelve months ago. The global economy appears to be firmly
on a recovery path, led by a strong economy in the US.
While Europe is also more positive, business owners remain
more cautious and lag far behind the US.
“If you are doing business in Asia, the survey strikes
a note of caution. It is critical to understand the differences
between the individual countries and the region cannot
be treated as an homogenous block.”
Business owners were also asked about their expectations
for their own companies:
- |
Prospects for employment
have improved in most countries in line with the
expected upswing in economic activity. Pakistan
(+48%), US (+45%), Australia (+41%) and Turkey
(+40%) have the strongest expectations for employment.
Germany and Poland (both –16%) are the most
pessimistic. |
- |
There is a wide expectation
that profitability will rise. This is typical
of this phase of the economic cycle. Japan is
the major exception with expectation of profitability
even more negative than last year with a balance
of –15% compared with 0%. |
- |
The business owners
who are most pessimistic about selling prices
all come from Asia – Japan (-50%), Singapore
(-39%), Taiwan (-30%) and Hong Kong (-26%). Russia
is the most optimistic with a balance of +59%. |
Notes to editors
The Grant Thornton International Business Owners Survey
(IBOS) was carried out among 6600 owners of medium sized
businesses from 26 countries between 1 September and 31
October 2003. IBOS began in 2002 and builds on the European
Business Survey (EBS) which Grant Thornton ran for the
previous ten years. The research was conducted by Experian
Business Strategies Limited and Wirthlin Worldwide.
