Uruguayan businessmen reviewed their expectations for next year, being more pessimistic regarding the improvement in economic situation and the arrival of investments to the country, showed the latest Business Expectations Survey prepared every six months Exante.
According to the study, which was accessed Scope“the expectations regarding the economic situation and the investment climate are those that show appreciable deterioration compared to previous editions.”
Only 22% of the 305 senior executives of companies operating in Uruguay and those who were consulted considered that the economy will be better next year, which implies a drop of 17% compared to the previous measurement carried out in April. The deterioration was also noted in the current situation, since 38% evaluated it positively compared to 46% six months ago.
Meanwhile, only 13% foresee an improvement in the climate of investments within a year, in fact leaving a negative net balance of responses (-4%), which had not happened since 2019, in the previous electoral round of the Uruguay.
It should be noted that the Exante survey was carried out in a complex context, during October, with the expectation of the first electoral round and the shadow of the social security reform plebiscite flying over the situation of the country.
However, the same study recalled that elections do not usually have a considerable impact on businessmen’s assessments since, since the return of democracy, the alternation of political parties in power did not affect macro economic guidelines.
Exante highlighted that “in any case, the evaluation of the business climate “It remains at extraordinarily favorable levels for the history of the survey.” 89% of the business owners consulted rated it positively (72% good and 17% very good).
Concern about the pressure of costs about the profitability of companies continues to be an important factor in the appreciation of companies operating in Uruguayalthough 37% expect an increase in it by 2025.
What do businessmen expect from the dollar and inflation by 2025?
The strengthening movements recorded by the dollar both in the local market and globally impacted the projections on the exchange rate at the business level.
The average expectations about how much the dollar will be in a year had an increase of more than 6%, going from 40.60 pesos in the April measurement to 43.10 pesos in October.
The estimate of a more expensive dollar impacted the forecast of the inflation for next year, with 51% of business owners considering that the Consumer Price Index (CPI) will exceed the target range of Central Bank 6%, despite the fact that in October it turned 17 months inside.
The requests of businessmen to the next government
When asked about the priorities that the government that emerges from the runoff on Sunday the 24th should have, among Yamandu Orsi (Wide Front) and Alvaro Delgado (National Party), businessmen mentioned areas that are not directly linked to the economy.
The two most urgent issues, almost equally prevalent, are improvements in quality of education (65%) and in the public safety (64%). Far below are aspects directly linked to business activity such as the opening of new markets (35%), State reform (32%) and inflation in the target range (32%).
Source: Ambito
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