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Croatian business community is the most pessimistic in the regionBusiness Sentiment Index |
Croatian businessmen are most pessimistic about the general prospects of the economy, as well as about the changes in the workflow and danger of not being payed on time by their debtors, according to “Business Sentiment Index”, conducted by Deloitte in 6 Central European countries. In total, over 40% of those surveyed feel that the general prospects of the economy will deteriorate over the next six months. However, Croatian business community showed greatest pessimisim, since up to 90% of those surveyed feels that economy will deteriorate even further.
On the other hand, 34% of Croatian businessmen are more optimistic about their companies’ future financial prospects, and only 7% of respondents gave negative answer to this question, which is above Central European average (15% of negative answers). The most positive feelings about financial prospects are in Poland, where 76% of respondents are optimistic on this subject.
The credit is quite easily available in all countries and industries, as 58% of responses are positive. “The credit availability is generally higher among companies with positive financial prospects. This correlation between credit availability and financial prospects is most evident in Croatia, Poland and Slovakia, which may suggest bank credit policies in these countries are slightly more related to companies’ actual financial prospects,” said Ivica Krešić, Director in FAS, Deloitte.
Looking in general at the companies’ debtors and outstanding dues, Croatia has the worst situation concerning liabilities where consumer expenditure fell very significantly in the last year, demand for exports is expected to continue to fall, and foreign investments are expected to be significantly reduced. Up to 58,6% of respondents from our country considers debts to be the factor that significantly worsened during last year’s period.
Central European average shows that aproximately 45% of respondents expects their revenue from sales in 12 months’ time will increase, while in Croatia this percentage is lower, about 31%. In all industries and countries respondents are fairly optimistic about the prospects for launching new products. The best opinions were in Croatia and Romania. “This optimism can be contributed to a need for new products in Croatia, since we have a relatively young market economy,” commented Krešić.
Above average pessimisim among Croatian business community is present even regarding workforce changes in the next 12 months’ period. Up to 55% of respondents expect their workforce will reduce, and only 10% expect to hire new employees. Our businessmen feel quite negative about their spending on capital goods (IT equipment, new buildings etc.) in the next 12 months, so almost 45% plans to reduce such costs. Croatian respondents are pessimistic, but within Central European average, regarding the likehood of M&A activities. Only 17% would plan to acquire a new company within the next year. In all the countries company acquisitions are very unlikely, so up to 60% feels pessimistic about prospect of M&A activities within next 12 months.
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Contacts
- Name:
- Sonja Ludvig
- Company:
- Deloitte Croatia
- Job Title:
- MCBD Senior Coordinator
- Phone:
- +385 1 2351 900
- sludvig@deloittece.com
Related links
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Business Sentiment Index
Conducted by Deloitte in 6 Central European countries