Business confidence declines in the new year

Following a substantial increase in December in the wake of the presidential election outcome, the LMD-Nielsen Business Confidence Index (BCI) declined by 12 basis points to register 174 in January. However, LMD notes that the index continues to stand tall compared to its all-time average of 127 and well above where it stood a year ago (101).

Commenting on the factors contributing to the latest results, Nielsen’s Director – Consumer Insights Therica Miyanadeniya says: “Following the initial euphoria brought about by the election of a new president, the enthusiasm of businesspeople seems to be waning somewhat.” The leading business magazine reveals that taxes rank among the most pressing concerns in business circles, followed by inflation and political interference. In addition, the brain drain is highlighted as an emerging issue among corporate executives.

Meanwhile, the economy, poor infrastructure and the prevailing political culture are considered to be leading concerns for the nation in general.

Pointing out that the February edition of the magazine mentions the direction of the index would depend on developments in the lead-up to the general election and the corporate sector’s perception of the caretaker government’s policies, a spokesperson for LMD reiterates that “it remains to be seen if this optimism continues to hold in the future.”

The publisher of LMD, Media Services, says the latest edition of the magazine was released to leading bookstores and supermarkets on 7 February (for the full BCI report, visit www.LMD.lk).