In October this year, the business climate indicator, which the Center for Economic Research and Reforms (CERR) calculates based on a large-scale survey of enterprises, showed an increase in relation to the levels of last month.
The Business Climate indicator, which is monitored monthly by the CERR, returned to the positive zone in October. If in August the composite indicator showed a rapid decline of 10 points, and in September a slowdown in the rate of decline, then in October the trend of gradual decline was interrupted.
During the month, the consolidated business climate indicator increased by 4 points and amounted to 57 points (a value above 0 points means an increase in business activity and vice versa), which assesses the state of the business climate as positive.
The growth of the consolidated indicator was significantly influenced by the dynamics of business climate indicators in the agricultural sectors, an increase of 14 points and construction of 7 points and 3 points in the service sector.
However, the indicator of the business climate in the industrial sector showed a noticeable decrease of 7 points, after the September jump of 13 points.
The most confident improvement in the current business conditions was noted by enterprises of the agricultural sector.
Estimates of the current state of business for the month added 3 points to 49, which is explained by a significant improvement in the agricultural sector, immediately by 26 points to 51.
The share of respondents who noted the current state of their business as "good" was 47%, and the share of those who noted as "bad" was 9%. 22% of enterprises increased the number of their employees, and 49% noted an increase in demand for their goods/services.
Despite the positive nature of business development and a slight decrease in price expectations, a quarter of respondents expect prices to rise.
Estimates of business expectations regarding the prospects for development in the next 3 months increased by 4 points to 65, which is mainly due to positive assessments of entrepreneurs from the construction sector, where optimism for the month increased by 25 values to 59 and the service sector, where the growth of expectations increased by 10 points to 66.
It was also revealed that business expectations regarding price increases for their goods/services in the next 3 months have become less frequent by 1%.
The balance in the estimates of expectations regarding demand and employment showed some weakening.
The share of entrepreneurs expecting an improvement in the general state of business in the next 3 months remains at a high level and is 67%. 49% expect a further increase in demand for goods and services, and 22% plan to increase the number of employees.
In general, the relationship between the indicators of the current situation and expectations means that the positive trend in economic development will continue in the next 3 months.
Assessments of the factors of business conditions – financing, land plots, electricity supply, tax burden – remained more negative.
In October, the share of entrepreneurs facing barriers decreased by 4 percentage points to 44%. Among the reasons affecting the deterioration of business, entrepreneurs named difficulties in accessing finance and land plots, as well as problems related to electricity supply, high tax rates and tax administration.
If in the industrial and service sectors by 8%, and in the construction sector by 15%, there was a decrease in obstacles related to access to finance, the number of complaints from representatives of agriculture, on the contrary, increased by 4%.
CERR monthly publishes a series of information and analytical materials based on the results of surveys of the business climate of the real sector, the service sector and business activity. Short-term qualitative assessments of the state of business are conducted on the basis of surveys and monitoring of regional activity. From January 2023 the Business Climate Index of Uzbekistan is published on the international economic portal Trading Economics.
Feruzbek Davletov, CERR
Phone.: (+998) 78 150-02-02 (416)