Business news from Ukraine

BUSINESS EXPECTATIONS IN UKRAINE’S CONSTRUCTION MARKET IMPROVE BY 5 P.P.

The business confidence indicator in the construction market of Ukraine in the first quarter of 2019 increased by 4.8 percentage points (p.p.) compared to the fourth quarter of 2018, to minus 12.5%. According to the poll of construction companies by the State Statistics Service, the assessment of a shortage of the current volume of orders fell by 10 p.p., to minus 30%.
According to the results of the survey, 32% of companies rated their current order volume as insufficient, 65% as normal for the season and only 2% as exceeding the norm.
Some 44% of respondents expect an increase in prices for their services in the first quarter of this year, which is 1 p.p. more than in the fourth quarter of 2018, while 2% of the companies surveyed predict a decrease in the cost of construction work, and 54% do not expect any changes in the price policy.
According to the service, companies participating in the survey are provided with orders for an average of five months, which corresponds to the indicators of 2018.
The service said in the first quarter unfavorable weather conditions will more affect the work of construction companies, and 39% of respondents will continue to experience financial constraints. In addition, 20% of companies will be constrained by an insufficient demand, 18% by a shortage of workforce.
Some 20% of the companies surveyed expect a reduction in the number of their employees in January-March 2019, while 16% predict an increase in the number of employees.

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INDEX OF BUSINESS EXPECTATIONS IN UKRAINE REACHES A RECORD SET

The index of business expectations of enterprises in Ukraine for the next 12 months has reached the highest level since the second quarter of 2011 – 120.6%, according to a survey of the National Bank of Ukraine (NBU) on business expectations, which was conducted in the first quarter of 2018. “The revival of business activity is expected by companies of all types of economic activity… High pace of growth of economic activity remains in place, mainly due to improved forecasts for growth in total sales of products, as well as investment costs for machinery, equipment and stock,” reads a report posted on the NBU’s website.
According to the NBU, the business increased an assessment of the financial and economic situation of its enterprises for the seventh consecutive quarter. A total of 88% of respondents assess their position as “satisfactory” or “good.” At the same time, the NBU notes that the optimism of businesses regarding their own situation supports the expectations for an increase in the volume of production as a whole in Ukraine. “This was stated by every third enterprise out of those polled. Yet every second believes that the country’s output will remain at the current level. Representatives of companies in the processing industry, trade and agriculture are the most optimistic,” the survey notes.
There has also been an increase in the number of companies that are optimistic about changing their financial situation during the coming quarters. The survey was conducted from February 5 to March 6, 2018. A total of 670 enterprises from 22 regions of the participated in the survey. They represent the economy by main types of activity, forms of ownership, and the number of employees.

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