Bulgaria's Business Climate Stalls in December 2011

Business | December 28, 2011, Wednesday // 11:41
Bulgaria's Business Climate Stalls in December 2011: Bulgaria's Business Climate Stalls in December 2011 Bulgarian national statistics data shows continuing lowering of business climat indicator percentage points. File photo

The total business climate indicator in Bulgaria in December 2011 preserves its level from the previous month, and a reduction is recorded only in construction.

The data was published Wednesday by the country's National Statistics Institute, NSI.

The composite indicator "business climate in industry" in December increases by 2.1% in comparison with the previous month. This is due to the slightly more optimistic managers' expectations about the business situation of enterprises over the next 6 months. The present

production activity is assessed as reduced, stocks of finished goods as raised and the expectations for production and employment over next 3 months, compared to opinions expressed in the previous month are also more unfavorable.

In December the uncertain economic environment and insufficient domestic demand are the main factors limiting industrial activity, as the uncertain economic environment is still above its usual average value for the last 10 years (by 22.3%).

The industrial entrepreneurs' expectations with regard to the selling prices in the sector are in direction of an increase over the next 3 months.

In December 2011 the composite indicator "business climate in construction" decreases by 5.0%, due to the increased managers' pessimism about the present business situation of the enterprises. The assessments related to construction activity and production assurance with orders is also more unfavorable (the balance value of the indicators drop respectively by 10.1% and 8.4%) in comparison with the previous month. At the same time the construction entrepreneurs' expectations about the activity over next 3 months are not optimistic. Forecasts for employment in the sector are also in a direction of decrease.

The uncertain economic environment and financial difficulties continue to be the main problems for the sector, although in the last month a decrease of their negative influence is observed.

Concerning sales prices in construction, expectations are for preserving their level over the next 3 months.

The composite indicator "business climate in retail trade" in December preserves its level from the previous month as managers do not expect a significant change of the business situation over next 6 months. The last inquiry registers some recovery of positive expectations for retail sales over next 3 months and expectations about orders placed with suppliers remain comparatively favorable.

The main factor limiting the activity in the sector remains the uncertain economic environment whose negative influence increases and in the last month has reached its maximum value (81.5%) since the beginning of the retail trade survey. At the same time the inquiry registers strengthening of the negative impact of the second-most limiting factor "financial problems."

Retailers' expectations regarding the sales prices are for a certain decrease over the next 3 months.

In December the composite indicator "business climate in service sector" increases by 2.8%, compared to November, due to the slightly improved expectations about the business situation of the enterprises over next 6 months. However, for the next 3 months the entrepreneurs have unfavorable forecasts concerning demand for services and employment in the sector. Regarding the current situation, the inquiry registers a decreasing tendency in the demand and movement of the personnel.

The uncertain economic environment is the most serious factor limiting the activity of the enterprises, followed by competition in the branch. At the same time, the negative influence of financial problems increases compared to the previous month.

Regarding sale's prices in the service sector, the managers foresee reduction over next 3 months

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Tags: NSI, construction, retail trade, business climate, service sector, industry, managers, entrepreneurs, survey, indicators

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