Finance leaders across Australia and New Zealand say the Middle East conflict is now a material drag on business performance, with higher costs, greater uncertainty, and disrupted supply chains flowing through the real economy.
A survey of nearly 700 Chartered Accountants Australia and New Zealand (CA ANZ) members found eight in ten are seeing higher costs, while six in 10 report elevated risk and uncertainty in business decision-making. Almost half are already grappling with supply chain disruption linked to the conflict.
CA ANZ’s membership spans finance leaders in sectors including manufacturing, retail, agriculture, logistics, and healthcare, providing a broad read on trading conditions on both sides of the Tasman.
Across both economies, more than 60% of respondents reported direct exposure to the conflict’s economic effects, with New Zealand businesses more affected than those in Australia.
CA ANZ chief executive Ainslie van Onselen (pictured left) said the results underline the immediacy of the shock.
“This is not a distant crisis. It is landing on Australian and New Zealand businesses right now, and our members are seeing it firsthand across every sector of the economy,” van Onselen said.
Among exposed organisations, higher energy costs are the most common pressure point, cited by more than three quarters of respondents. Many are also dealing with supply chain disruption, increased production costs, freight delays and exchange rate volatility, with New Zealand businesses reporting greater exposure to shipping disruption than their Australian counterparts.
These cost shocks are already shaping the policy backdrop. The Reserve Bank has responded to persistent inflation pressures with a series of rate hikes back to a cash rate of 4.35%, noting that conflict‑driven fuel and commodity costs risk broader price spillovers.
CA ANZ chief economist professor Richard Holden (pictured center) warned the impact will be broad-based, noting that “Higher energy prices don't just hit at the bowser, they push up the cost of food, freight, manufacturing, meaning everything increases in price.”
Around half of finance leaders are monitoring developments without yet putting firm plans in place, underscoring the level of uncertainty facing investment and hiring decisions. Roughly one in five expect to raise prices, with that proportion higher in New Zealand than Australia, a shift that could further strain business and household budgets.
Members said government support should focus on infrastructure to strengthen supply chains and direct relief on energy costs.
CA ANZ group executive advocacy, public, and government affairs, Damian Ogden (pictured right), said “Government cannot keep governing crisis to crisis” and called for a stronger focus on fuel security, reliable energy and robust supply chains.
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