Business confidence continues to fall

Tuesday, 7 April 2015 01:27 - - {{hitsCtrl.values.hits}}

Political uncertainties and rising economic concerns have delivered a blow to business confidence, as the unique index continues to be affected by goings on in the sphere of governance, says leading business magazine LMD. The April edition of LMD reports that the LMD-Nielsen Business Confidence Index (BCI) “declined by eight points in March, to 152, amid what appears to be an erosion of optimism regarding the economy, inflation and longer-term business sentiment.” “It is now only 10 basis points higher than it was prior to the 8 January presidential election. Soon afterwards, as we know, the index shot up to an all-time high of 194,” LMD notes.

Nielsen’s Managing Director Shaheen Cader says in the magazine: “Some respondents have expressed concerns about their perceived lack of direction on where the country is heading, as well as a concern over the possibility of the rupee being devalued.” As for the economy, businesspeople “are largely optimistic,” LMD reports, noting however that this optimism has waned from the previous month. In March, 44% of those polled said that economic conditions are likely to improve in the next 12 months, but nearly an equal number (41%) feel that things will ‘stay the same.’ “Given the visible concerns articulated by corporate types about the political future of the country, as well as alleged irregularities in many layers of governance past and present, any missteps could lead to a downward slide in business sentiment,” the magazine’s Business Sentiment column concludes. A spokesperson for LMD’s publisher Media Services says the magazine was released to bookstores and supermarkets by Monday, 6 April (for the full BCI report, go to www.LMD.lk).