Confidence in the state of the global economy was due to register a slight recovery in the current quarter, according to a World Economic Forum (WEF) index on Monday, supporting views that SA’s economic prospects are likely to brighten this year given its close links to the world economy.
The index improved amid some positive signs from the eurozone and a sense that the worst fears for the US "fiscal cliff" debt crisis had been allayed. The global confidence index polled 390 experts on three sub indices of global economy, governance, and co-operation.
The majority of participants came from business followed by those in academia across six regions of the world.
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The most notable improvement was recorded in the global economic sub index, which rose to 0.43 from 0.38 in the final quarter of last year. An index level of 0.5 is neutral, while a reading below this shows lower confidence levels.
"We have seen a slight increase in terms of confidence in terms of the economy specifically," WEF Network of Global Agenda Councils senior director Martina Gmür said in an interview. "The recovery in confidence is still very weak and tentative, but signs of a more optimistic outlook are there."
Stanlib economist Kevin Lings said SA’s economic performance was closely correlated with world economic events and a rise in global confidence would generally have a positive effect on the country.
"SA should be looking to benefit from a pick-up in global optimism after years of crisis management in most parts of the world."
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