Accountants turned more optimistic about the Singapore economy in the final quarter of last year, despite business investment falling over the same period. According to the quarterly Global Economic Conditions Survey (GECS), more than half of local respondents were optimistic about the state of the economy - the first time this has happened since the survey began in 2009.

And as more respondents grew sanguine about the Republic's economic outlook (51 per cent were optimistic in the fourth quarter, up from 34 per cent in Q3), a smaller proportion felt the glass was half empty (pessimists made up 46 per cent, down from 55 per cent).

Said Leong Soo Yee, head of ACCA Singapore: "Faith in the economy is pointing in the right direction in Singapore, but the businesses our members are working in, while showing more confidence in their future prospects, are not seeing that translated into investment as yet. The rising confidence in the economy, as well as in their own businesses, could mean business opportunities would eventually improve."

The survey showed that business confidence inched up in Q4 as well. Some 19 per cent of respondents reported an increase in confidence, up from 18 per cent in Q3.

The share of those who reported a loss of confidence fell to 32 per cent in Q4 from 41 per cent in the previous quarter.

The 20th edition of the GECS survey, run by the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA), was conducted in late November and early December last year.

Some 1,450 ACCA and IMA members from around the world - including more than 130 chief financial officers - took part in the Q4 survey; 63 of these accountants were from Singapore.

Globally, the survey found that finance professionals had more faith in the strength of the global economic recovery in Q4 than at any time over the past five years.

Some 55 per cent believed conditions were improving or about to do so, up from 53 per cent in Q3, while 42 per cent felt that economic conditions were deteriorating or stagnating, marginally lower than the 43 per cent in the previous quarter.

But at the local level, ACCA and IMA noted how business costs are rising in Singapore, quoting an unnamed partner in a "mid- tier accountancy firm" here as saying: "Economic demand is still moderately high. However businesses are faced with high labour costs and steep rents for business premises. Profit margins will continue to be squeezed as businesses are getting more competitive.

"The market itself is looking for an equilibrium point where high operating costs and reasonable investment return can co-exist."