Improved business conjuncture in Bulgaria in May

In May 2019, the total business climate indicator  increases by 1.3 percentage points compared to the previous month, which is due to the improved business conjuncture in construction and retail trade.

Industry. The composite indicator ‘business climate in industry’ preserves approximately its April level. The industrial entrepreneurs’ expectations about both the business situation of the enterprises over the next 6 months and their activity over the next 3 months remain favourable.  The main factors limiting the business development in the sector continue to be the uncertain economic environment and shortage of labour as in May a decrease of their negative influence is observed. Concerning the selling prices in industry, the managers foresee them to remain unchanged over the next 3 months.

Construction. In May the composite indicator ‘business climate in construction’ increases by 6.9 percentage points  as a result of the more optimistic construction entrepreneurs’ assessments and expectations about the business situation of the enterprises. Their opinions about the construction activity over the last 3 months, as well their expectations over the next 3 months are also improved. However, the enquiry reported an increase in the number of the clients with delay in payments. In the last month, the negative impact of the factor ‘shortage of labour’ strengthened, as 51.9% of the managers pointed it out as the main problem for their activity. In second and third place remain the difficulties, connected with the uncertain economic environment and competition in the branch.

As regards the selling prices, construction entrepreneurs’ expectations are for preservation of their level over the next 3 months.

Retail trade. The composite indicator ‘business climate in retail trade’ increases by 2.1 percentage points  which is due to the improved retailers’ assessments and expectations about the business situation of the enterprises. However, concerning the volume of sales and orders placed with suppliers  over the next 3 months their expectations are more reserved. The competition in the branch continues to be the main factor limiting the business development, followed by the uncertain economic environment and insufficient demand.  The retailers do not foresee a change of the selling prices over the next 3 months .

Service sector. In May, the composite indicator ‘business climate in service sector’ decreases by 2.2 percentage points as a result of the unfavourable managers’ assessments about the present business situation of the enterprises. As regards the demand of services the present tendency is assessed as slightly reduced, while the expectations over the next 3 months are improved. The most serious problems for the enterprises’ activity remain the competition in the branch and uncertain economic environment, though in the last month a decrease of their unfavourable influence is reported. The managers’ expectations concerning the selling prices in the service sector are for them to preserve their level over the next 3 months.