THE ECONOMY
CORPORATE HOPES TAKE FLIGHT
There’s been a surge of optimism following the recent presidential election
Optimism in corporate circles has surged following the 21 September presidential election, marking a positive swing in economic sentiment under the new executive. The latest findings of the monthly LMD-PEPPERCUBE Business Confidence Index (BCI) survey highlight this notable shift in perceptions.
As PepperCube Consultants notes, the outcome of the election sparked significant changes in the corporate landscape as businesses anticipate reforms on the economic and governance fronts.
THE ECONOMY In October, 41 percent of survey participants expressed optimism about the economy ‘improving’ over the next 12 months, recording a substantial increase of 33 percentage points from a mere eight percent in the previous month.
Meanwhile, half of the survey population believe the economy will ‘stay the same’ (an 18% decrease from September) while nine percent expect it to ‘get worse,’ representing a decline of 15 percentage points.
SALES VOLUMES There’s a clear shift in sentiment among salespeople as their concerns about the economic outlook have subsided, following a pick-up after three consecutive months of decline since June.
The latest poll reveals that 46 percent of executives anticipate an improvement in their sales volumes over the next 12 months, representing a mammoth 38 percentage point spike from September.
And 45 percent expect their sales numbers to ‘stay the same,’ which represents a substantial 24 point decrease from 69 percent in September. Additionally, only nine percent expect their sales volumes to ‘get worse’ (down 14%).
In the prior month, only five percent of participants reported an ‘increase’ in sales volumes compared to last year, whereas this count jumped to 30 percent in October (a 25% increase).
Additionally, 47 percent reported that their sales numbers ‘stayed the same,’ – a marked difference of 22 points from the previous month (69%).
Twenty-three percent reported lower sales volumes (down from 26% a month ago).
Looking ahead, expectations of higher sales volumes over the next three months have soared to 40 percent – versus only four percent in September.
Exactly half (50%) believe their sales volumes will ‘stay the same,’ which represents a 19 percentage point drop. Meanwhile, only one in 10 feel their numbers will ‘get worse’ over the next three months (a 17% drop compared to September).
INVESTMENT CLIMATE The downtrend reported since August took a U-turn in October as perceptions shift.
Six percent rated Sri Lanka’s investment prospects as ‘very good’ – up from two percent in the preceding month. And the proportion of participants that view the outlook as ‘good’ increased by three points to 61 percent.
Twenty-six percent believe the investment climate is ‘fair,’ which is a two point decline from 28 percent in September. And only seven percent rate the outlook as ‘poor’ or ‘very poor’ (down five percentage points from September’s 13%).
EMPLOYMENT PROSPECTS A notable 22 percent of businesses plan to ‘increase’ their staff numbers, an 18 percentage point jump from the four percent recorded in September.
In contrast, a large majority (72%) intend to maintain their current staff levels – down from 87 percent the previous month.
