Confidence in world economy recovers in 2013 first quarter – WEF

Confidence in the state of the world economy recovered “somewhat” in the first quarter of 2013, the World Economic Forum said January 21, 2013 citing its index poll of 390 experts.

According to the Davos-based Forum, the Economic Confidence Index rose to 0.43 from 0.38 on a scale of 0 to 1, getting closer to optimistic territory 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 confidence indices of the Index are calculated by taking the average of the following values that have been assigned to the responses: “Not at all confident”: 0, “Not confident”: 0.25, “Neutral”: 0.5, “Confident”: 0.75, “Very confident”: 1.

The Index targets large group of international experts who focus on monitoring key trends, identifying global risks and mapping their interlinkages.

The Index indicated that North America marked the most improved in confidence regionally.

“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,” said Martina Gmür, Senior Director of the Forum’s Network of Global Agenda Councils.

The WEF says the number of respondents with a pessimistic (“not confident” or “not at all confident”) outlook for the economy in 2013 fell to 43% from 56% last quarter, while the percentage of optimists (“confident” or “very confident”) increased to 23% from 17%.

And the remaining 34% were neutral. This is the second highest level of economic confidence shown since the index began seven quarters ago, reports the Index.

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

It observes the percentage of respondents who expected major social, geopolitical, environmental or technological disturbances hovered at 46%, 50%, 35% and 19% respectively.

By Ekow Quandzie