African Finance Leaders Brace For Rising Costs And Inflation As Global Economic Uncertainty Persists
The fallout from the Middle East conflict continues to impact the results from the ACCA and IMA Global Economic Conditions Survey (GECS). The quarterly survey, which was conducted between 3 and 17 June, before the renewed fighting and resumption of the U.S. naval blockade, highlights how geopolitical tensions, persistent supply chain disruptions and rising commodity prices continue to reshape the global business landscape, with significant implications for African economies that remain closely integrated into international trade and commodity markets.
The survey found that more than three-quarters of accountants worldwide reported higher operating costs during the second quarter of 2026—the highest level recorded since the survey began. Among Chief Financial Officers (CFOs), 83% reported increased operating costs, representing a record-breaking increase of more than 20 percentage points compared with the previous quarter.
Despite these pressures, confidence among accountants improved during the second quarter after falling to near-record lows earlier this year. However, business sentiment remains well below historical averages, reflecting continued caution over the pace of global economic recovery and ongoing geopolitical uncertainty.
The survey also found that the Global New Orders, Capital Expenditure and Employment indices all declined during Q2, indicating a moderation in global economic activity. While these indicators do not currently point to a severe downturn, they suggest that organisations are becoming increasingly cautious about hiring, investing and expanding operations.
Across regions, confidence remains subdued in North America and Western Europe, while Asia Pacific recorded a strong recovery and is now performing meaningfully above its historical average, supported by resilient economic activity, expanding technology investment and growing demand linked to the global artificial intelligence (AI) boom.
Although Africa was not analysed as a standalone region, the continent is likely to feel both the risks and opportunities arising from these global trends. Increased demand for critical minerals, digital infrastructure and renewable energy investment continues to present significant opportunities for African economies, even as businesses contend with external shocks, inflationary pressures and tightening financial conditions.
The survey identifies economic pressures as the leading business risk globally, cited by 22% of respondents, overtaking geopolitical instability (20%) and cybersecurity (14%). Finance professionals also highlighted the growing importance of responsible AI adoption, cyber resilience and stronger governance as organisations adapt to an increasingly complex risk landscape.
Inflation expectations have also strengthened considerably. Nearly 72% of respondents expect inflation in their country to increase over the next three months, reflecting continued concerns over commodity prices, transport costs and supply chain disruptions.
At the same time, 42% expect interest rates to rise over the next three months, compared with just 16% in the fourth quarter of 2025, suggesting that businesses anticipate further monetary tightening as central banks seek to contain inflation.
For African organisations, where borrowing costs remain elevated in several markets, higher interest rates could further constrain business investment, increase financing costs and slow private sector expansion. These conditions reinforce the importance of robust financial planning, prudent capital allocation and proactive risk management.
Commenting on the findings, Alain Mulder, Senior Director, Europe Operations & Global Special Projects at IMA, said: “The AI boom is providing major support to the global economy and financial markets, but developments in the Middle East over coming months will be crucial. If progress can be made in resolving the conflict, that would clearly be supportive for global growth as we progress through the second half of 2026. But downside risks would quickly build if there were a return to major hostilities and surge in energy prices.”
Jonathan Ashworth, Chief Economist, ACCA, said: ‘Sharply rising costs were unsurprisingly a major issue for firms in Q2. If they increasingly try to pass these on to the consumer, this would significantly raise the risk of policy tightening by the world’s major central banks. That said, policymakers will be hoping for favourable developments on the diplomatic front, and a return of oil prices to around pre-crisis levels, potentially allowing them to sit on their hands for the rest of 2026.’
For Africa’s finance profession, the survey reinforces the increasingly strategic role of accountants and CFOs in helping organisations navigate uncertainty. Beyond financial reporting and compliance, finance leaders are expected to strengthen enterprise resilience, guide investment decisions, support digital transformation and enable sustainable growth across increasingly volatile markets.
As African economies continue advancing industrialisation, regional integration through the African Continental Free Trade Area (AfCFTA), and digital transformation, the finance function will remain central to helping organisations balance short-term economic pressures with long-term competitiveness and value creation.
About the Global Economic Conditions Survey
The Global Economic Conditions Survey (GECS), jointly conducted by ACCA and the Institute of Management Accountants (IMA), is one of the world’s largest and longest-running quarterly surveys of professional accountants. It provides timely insight into business confidence, economic conditions and emerging risks based on the views of finance professionals across more than 100 countries.