Analytics, Business, Economics, Latvia, Markets and Companies

International Internet Magazine. Baltic States news & analytics Tuesday, 21.08.2018, 01:09

Highest business confidence recorded in Riga Region, Zemgale, Kurzeme

BC, Riga, 22.09.2017.Print version
Entrepreneurs in Riga Region, the central Latvian province of Zemgale and the western province of Kurzeme showed the highest business confidence in the second quarter of 2017, representatives of Citadele Bank told journalists citing the latest Citadele Index survey, cites LETA.

Business confidence was rated at 52.72 points in Riga Region, 52.69 points in Zemgale and 52.19 points in Kurzeme. Less upbeat sentiments were recorded in the eastern Latvian province of Latgale and northeastern province of Vidzeme where business confidence was rated at 46.25 points and 49.13 points respectively.

According to the latest Citadele Index data, Latvian entrepreneurs’ assessment of the current situation improved over the past quarter and their outlook on the future was also quite optimistic. The strongest optimism was voiced by respondents representing manufacturing (52.79 points), construction (51.69 points) and the services sector (50.32 points). Meanwhile, cautiousness still prevailed in the trade sector where business confidence was rated at 48.93 points.

Although the business confidence of entrepreneurs operating in the domestic market did not rise above the optimism threshold (50 points), it generally improved, reaching the highest point in three years. Businesses with foreign capital showed the highest confidence. The confidence gap still remained wide between the highly optimistic large companies and the small businesses whose owners and managers remained below the 50-point mark.

The Citadele Index reveals that at least 40% of businesses in Latvia are affected by labor shortages and nearly half of the surveyed companies choose to hire employees that still have to be trained for their jobs.

Citadele economist Martins Abolins commented that notwithstanding the growing optimism and positive economic trends, business sentiment remained fragile, which to a large extent can be put down to political developments like Brexit, the Unites States’ vague political signals and North Korea’s nuclear program. All these factors are still causing concerns about future economic growth and do not allow entrepreneurs to believe in more positive future perspectives. “Otherwise, entrepreneurs should be much more upbeat, because economic growth in the world, Europe and consequently also in Latvia is very strong,” said Abolins.

Economics Minister Arvils Aserandens (Unity) pointed out that Latvia has been showing relatively strong GDP growth for the second consecutive quarter already. “In the first half of the year it grew 4% against the same period year ago,” the minister said.

The Citadele Index is based on a survey of 750 company owners and business executives, representing firms of different sizes doing business in different industries. The index is published quarterly since 2004. SKDS pollster carries out the survey for Citadele Bank.

Search site