Belarus industrial confidence index up in March-April

Belarus's industrial confidence index increased in March-April, the press service of the Economy Ministry told BelTA after a survey of business executives in Belarus by the Research Institute of Economy at the Economy Ministry in March and April 2016.

“The industrial confidence index, which is designed to show the overall state and trends in industry, still remains in negative territory, but it has been growing since March by 4 points every month and totals minus 19 points,” the press service noted.

This was thanks to a more optimistic assessment of demand and positive growth forecasts, it said.

The market survey polled 370 heads of industrial enterprises in Belarus. It covers more than one third of enterprises employing more than 100 people, which account for about 90 per cent of the industrial production of the country.

In addition, the survey polls monthly 55-60 per cent of enterprises employing more than 1,000 people. Over 60 per cent are the enterprises included in the State Register of Economic Entities hold dominant positions in commodity markets.

The survey has recorded an increase in industrial output recently. In April 44 per cent of polled business executives reported an increase in industrial output, with 33 per cent saying the volume of production at their enterprises had remained at the same level.

In April, capacity utilization in industry was on average at 60 per cent (an increase of 5 percentage points from February). The share of enterprises with over 80 per cent of capacity reached 21 per cent in April, up 4 points from the previous survey. The number of companies using their capacities at 41-50 per cent and 71-80 per cent increased. Their shares made up 12 per cent and 14 per cent, respectively.

In connection with the expected increase in demand, business executives were asked whether the capacities of the enterprises were sufficient. 71 per cent of them said they were sufficient, 24 per cent said more than sufficient.

The fall in demand for industrial products both on the domestic and foreign markets slowed by March (following a considerable reduction in demand in February 2016). April saw a revival of the aggregate demand for commodities. 28 per cent of the polled reported the growth in demand, up 7 per cent up from March.

The average period of availability of orders for industrial companies was gradually improving: 2.3 months in February, 2.4 months in March, and 2.6 months in April. The April index was the highest showing over the last 1.5 years.

The level of backlog of inventory was assessed as excessive by 32 per cent of the polled and as normal by 52 per cent. 13 per cent of the respondents stated that the level of the backlog of inventory at their companies was below normal. The prices for industrial products continue growing, but the pace of growth has decelerated slightly.

In April, as many as 19 per cent of the respondents said that over the previous month the prices for their products increased (in March by 25 per cent). 76 per cent of business executives reported price stability. In April, 43 per cent of the business executives said that in March the production costs went up, and only 8 per cent managed to reduce expenditures.

Sentiments regarding industrial output were generally positive. As many as 39 per cent of company executives expect production to increase and 12 per cent to fall.

A total of 13 per cent expect a growth, and 10 per cent believe there will be redundancies. As for the aggregate demand for products, the majority of business executives anticipate a growth both in domestic and foreign markets. More than a half (55 per cent) expect no changes in the economic state of their enterprises in the coming month. Some 17 per cent voiced negative expectations, and 26 per cent of the respondents anticipate improvements.

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