Biz confidence dips in November

The December edition of leading business magazine LMD reports that business confidence fell sharply to 144 in November, compared to 165 in the previous month. 

It also notes that this is the steepest decline in the LMD-Nielsen Business Confidence Index (BCI) since October last year.

“While there is visible improvement on key infrastructure project execution and clarity on policy from the Government, the environment and policy are still not seen as being conducive for investment growth,” observes Nielsen’s Managing Director Sharang Pant in LMD.

He adds: “Inflation and interest rates remain as concerns and the increase in VAT from 1 November is seen as being detrimental to certain businesses. Both capital and workforce expansion are therefore taking a backseat.”

However, the exclusive monthly survey reveals that four of the 10 respondents expect an improvement in the economy in the coming 12 months, versus 34% and 26% expecting more of the same or worse respectively. 

Where business prospects are concerned, LMD states that nearly a fifth of the sample population feel that sales volumes will come under pressure whereas only 3% were as pessimistic in October. Nevertheless, a large majority (63%) of those surveyed continue to hold a positive outlook of their business prospects.

Looking ahead, a spokesperson for LMD states that “the index is also at a point where its average has been in the last 12 months, so this could reflect a stabilisation of sorts – for the time being at least. But the December survey will convey a verdict on the budget proposals by businesspeople, so we are projecting another fall in the index.”

LMD’s publisher Media Services says the December edition of the magazine will be released to bookstores and supermarkets on Friday, 9 December (for the full BCI report, go to www.LMD.lk).