According to the latest published results of the CONFIDEX S2 2023 survey, Romanian managers’ confidence in the economy fell in the second half of this year to 48.1, an average level close to the level recorded at the beginning of last year (47.8). from Impetum Group.

The fall in confidence is taking place against the background of new fiscal measures and expectations of a slowdown in the national economy. The most pessimistic are agriculture (45), industry (47.4), construction and trade (both with 47.8). At the opposite pole, the most optimistic sectors are energy (50.7), IT (50.4) and services (49.8).

According to the CONFIDEX survey for the second half of 2023, the main concern of Romanian managers is related to new fiscal measures and tax increases, with 31% of participating entrepreneurs expressing concern about this. At the same time, 36% of executives participating in the study estimate that their business will be affected to a large or very significant extent, while 39% are preparing for a medium impact. Only 21% of executives said the tax measures would affect them slightly, very little, or not at all.

What are the managers’ expectations for the next 6 months?

After the fiscal measures, the other concerns of Romanian entrepreneurs for the next six months, according to the CONFIDEX S2 2023 survey, are the lack of working capital and cash flow (15% of respondents, significantly higher than 5% at the beginning of the year). year), the increase in the cost of raw materials and utilities (12%, from 9%), a drop in sales, a reduction in the number of customers and orders (28%, a slight increase compared to 27% in the first half of this year) and a lack of labor (15%, which , however, down from 27%).

Regarding the prospects for the development of the national economy for the next six months, more than 60% of managers believe that it will worsen, and are already preparing for a worsening of working conditions, or even for a recession, which will correspond to market trends in the region and the euro zone.

Large companies are more optimistic

Although the overall impact of the new fiscal measures is perceived negatively, at the individual level the situation is more weighted, CONFIDEX data show. The level of the confidence index is different depending on the size of the company: the higher the staff turnover, the more optimistic the managers. Companies with a turnover of more than 10 million euros have an index of 51.2, which is almost 12% higher than the representative index for companies with a turnover of between 100,000 and one million euros, which stands at 45.8.

“CONFIDEX results once again realistically reflect the state of mind in the Romanian economy. If in previous issues we talked about a number of factors that aggravated the feelings of Romanian managers, such as the pandemic, the war in Ukraine, inflation or the workforce crisis, this time the fiscal news left its mark on the perception and expectations of managers. The optimism of the first half of this year has dissipated, giving way to caution. However, if you look segmentally, you can see that the value of the mood index of managers who manage large companies with a turnover of more than 10 million euros is more than 10% higher than that of companies with a turnover of less than 1 million euros. These figures indicate a greater degree of resilience of big business in the face of environmental uncertainty. This is a signal that indicates the need for investments in the direction of strengthening market positions for companies whose strategic goals are development and scaling,” said Andrii Chonka, CEO and co-founder of Impetum Group.

What opportunities do Romanian managers see in difficult times?

In this economic context, 55% of Romanian businessmen declare their openness to exploring alternative sources of financing, apart from internal financing methods (reinvestment of profits or capital injection from shareholders). Cost control and reorganization is also an option for the 10% of managers at the level with access to European funds.

Given that access to credit is problematic for a quarter of managers participating in the study, they are open to other sources of financing, such as investment funds, business angels or other entrepreneurs focused on investing in already established companies. The CONFIDEX study shows that 80% of executives have a good or very good opinion of these sources of business financing.

“Whenever our economy faces challenges, companies find themselves in a position to not only adapt, but to open up new opportunities that didn’t exist or weren’t very visible during periods of calm. Now more than ever, it is necessary to discuss mechanisms to prevent instability for Romanian entrepreneurship, which is much less resistant to any shock waves than large multinational companies. Thus, the need for financing and development of Romanian enterprises opens the way to explore alternative sources of financing that can meet the needs of managers, especially in these periods when the economy is tense,” said Andrej Csonka, CEO of Impetum Group.

According to the latest CONFIDEX survey, other opportunities targeted by Romanian managers are increased market demand (18% of managers compared to 15% in 1H 2023), product diversification and development (15%, from 9%) and easier access to markets and international expansion (decrease from 19% to 11%).

CONFIDEX is the only long-term study in Romania designed to measure Romanian managers’ confidence in the economy and decipher the challenges facing the local business environment. Now in its 9th edition, research has become an iconic tool for business decision-making.

The research conducted by the company Impetum Group has been trying for 3 years to make a clear picture of the perception of Romanian businessmen. By extrapolating trends, the company provides stakeholders with a tool that helps them better understand the times we live in and make sound and informed decisions that positively impact the business environment and society as a whole.

More than 2,500 entrepreneurs and senior executives have contributed to the 9 editions of CONFIDEX in establishing extremely important benchmarks for the Romanian economy, valuable in uncertain times such as the ones we are currently experiencing.