July, 3, 2020
Amid a partial reopening of the country to civil and business life, the share of the corporate executives who say the Sri Lanka economy in general will improve in the coming 12 months continues to rise with 42% ( compared to 36% in May) of respondents to the latest LMD- Nielsen Business Confidence Index (BCI) survey reflecting this sentiment.
A little over a third ( down from 41% in the previous month ) of those polled anticipate economic conditions to get worse during this period while another 24% believe that the economy is likely to remain the same.
This sense of optimism is observed in relation to long – term business prospects as well as with 68% of survey participants stating that sales volumes will improve in the next 12 months- this in fact, is higher than that recorded even in pre- COVID months.
However, where short term business prospects are concerned only 27% (down from 32% in May) of respondents point to improve sales volumes with the majority (44%) saying they are likely to be worse off in the three months ahead.
Meanwhile, positive sentiment regarding business performance compared to the prior year has improved slightly from 9% in May to 15% in June.
Confidence about the investment climate continues to wane with a mere 6% (versus 9% in the preceding month) of business people saying this is a good time to invest in the country.
Conversely, the majority view on prevailing funding conditions is negative with nearly two- thirds of the sample indicating a ‘poor’ or ‘very poor’ investment climate.
Perhaps surprisingly 9% (up from 5% - in both April and May) of those spoken to by the pollsters revel plans to expand their workforce in the coming six months and while the majority (78%) of respondents anticipate their employee count to remain the same in the six months ahead, 13% say that staff cuts may be in the offing during this period.