Crisis Does not End Overnight: 2017 to Be Turbulent for Businesses

January 4, 2017, Wednesday @ 11:42 in Business | Views: 148
Crisis Does not End Overnight: 2017 to Be Turbulent for Businesses Photo: Vlatko Perkovski

With uncertainty regarding the end of the crisis, the domestic businessmen have prepared their business plans for 2017. Although elections are over, there was no positive outcome so far on the domestic political scene, which makes businessmen exceptionally cautious amid their 2017 growth projections.

They say that the situation will stabilize, but some are more than certain that at least the start of 2017 will be turbulent, adding that due to the long-term problems and unstableness they cannot plan some major investmets while their foreign partners cancel orders.

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Construction work companies fear the economy, although this branch showed great results despite the crisis. In other words, the construction work business was the moving force in Macedonia's economy.

Representatives of the domestic business sector have said that due to the crisis, they have lost a lot, and if it is prolonged it will push their partners away, and reduce their contracts.

"The uncertainty has caused some orders to be canceled. We need a functioning and stable government, as well as functioning judiciary. Every political crisis increases the lack of possibility to plan and it has a negative effect on the business, as well as the entire economy," said Ace Antevski, head of Rade Koncar factory.

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According to the projections of the Government for the 2017 Budget, Macedonia's GDP should grow by 3 percent. Export is expected to grow by 6 percent, which will cause the economy to grow further. The construction business is expected to grow over 5 percent.

Construction work businessmen say they are expecting end to the crisis, or else, their situation may worsen as well.

"Despite the 2-year crisis the construction sector marked a 31-percent growth in Q4. However, the crisis can cause stagnation in this segment as well, and that directly affects the overall economy, just because building is the moving force of the domestic economy. We are not sure how long the crisis will last but if it lasts any longer it may withhold the purchase of apartments, or decrease the capital projects in housing," said Robert Hall, president of the Chamber of Construction, within the Macedonian Chambers of Commerce (MCC).

Daniela Arsovska, president of MCC, said that businessmen should expect a turbulent year.

"Turbulent because the business community needs functional institutions, and due to the continual uncertainty - the decrease of the investments and the export is very evident. In accordance with the macroeconomic index, 2016 should end with a 2.5 percent growth, and 2017 is expected to have some 3 percent growth. There are also risk-factors for these projections that can affect the economy," Arsovska said.

Moreover, in 2016 the economy dropped in the industrial sector. Some 4.9 percent in November, and 3.6 in October. But, despite this, the other months have marked growth in the industrial sector. Experts claim that the negative trend of October and November may continue, and affect the economy, because industrial production is an important index of the economic movement.

Overall, Macedonian economy marked a 2.4 percent growth in Q3 in 2016. The projections for 2017 were made based on the expectation that the political crisis will have a positive end after the election.

Tags: business, economy, growth, GDP, Macedonia, 2016, 2017, projections