Indian economy tops optimism list
India has regained top slot in optimism among privately held businesses for 2009.
By Shailesh Menon, ET Bureau |
India has regained top slot in optimism among privately held businesses for 2009. While optimism amongst privately held businesses (PHBs) around the world slumped by 56% over the last 12 months, pushing the Grant Thornton International optimism/pessimism barometer to a record negative balance of -16% compared to +40%, this time last year.
Despite raging pessimism, the survey found that PHBs from 11 countries remained optimistic about the outlook for their economies, with India leading this group (+83%), and Botswana (+81%) with Brazil (+50%) also emerging on the top. Japan (-85%) and Spain (-65%) were the most pessimistic.
It is the first time that pessimists have outweighed optimists about the outlook for their economy since the research began in the current form in 2003 but this year's International Business Report, which surveyed senior executives from over 7,000 PHBs across 36 economies, also shows an overwhelming consensus that falling consumer demand is the biggest threat to PHB businesses.
There are also some startling differences in attitude towards the economic crisis between the mature and emerging economies. Of the four largest trading nations, PHBs in the United States and mainland China, who together contribute over 32% of global GDP1, scored their optimism at -34% in the United States and +30% in Mainland China.
Similarly, Japan and India (collectively contributing over 11% of global GDP) scored their optimism at -85% and +83% respectively.
"These polarised results suggest that despite the current slowdown, there are still pockets of hope in the global marketplace for PHBs," explained Vishesh Chandiok, National Managing Partner ��� Grant Thornton India.
"Their macro view of the world economic stage explains the overall slump in optimism but there are still signs of optimism in some economies and also clear signs that PHBs, while preparing for the downturn, are also seeking to leverage on opportunities this could bring," Mr Chandiok added.
When asked to identify the most significant factors causing most concern for their business, PHBs in 33 out of the 36 economies cited a fall in consumer demand, while citing a shortage of business credit as a secondary concern.
Despite raging pessimism, the survey found that PHBs from 11 countries remained optimistic about the outlook for their economies, with India leading this group (+83%), and Botswana (+81%) with Brazil (+50%) also emerging on the top. Japan (-85%) and Spain (-65%) were the most pessimistic.
It is the first time that pessimists have outweighed optimists about the outlook for their economy since the research began in the current form in 2003 but this year's International Business Report, which surveyed senior executives from over 7,000 PHBs across 36 economies, also shows an overwhelming consensus that falling consumer demand is the biggest threat to PHB businesses.
There are also some startling differences in attitude towards the economic crisis between the mature and emerging economies. Of the four largest trading nations, PHBs in the United States and mainland China, who together contribute over 32% of global GDP1, scored their optimism at -34% in the United States and +30% in Mainland China.
Similarly, Japan and India (collectively contributing over 11% of global GDP) scored their optimism at -85% and +83% respectively.
"These polarised results suggest that despite the current slowdown, there are still pockets of hope in the global marketplace for PHBs," explained Vishesh Chandiok, National Managing Partner ��� Grant Thornton India.
ADVERTISEMENT
"Their macro view of the world economic stage explains the overall slump in optimism but there are still signs of optimism in some economies and also clear signs that PHBs, while preparing for the downturn, are also seeking to leverage on opportunities this could bring," Mr Chandiok added.
When asked to identify the most significant factors causing most concern for their business, PHBs in 33 out of the 36 economies cited a fall in consumer demand, while citing a shortage of business credit as a secondary concern.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
