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Analysis: business people estimate the turnover of 2019 will be reached in 2022
The economic recovery in Romania, after the pandemics, will be an asymmetric one, with the sectors which will register a supported growth and the others which will continue to face significant difficulties, and over 66% of the companies interviewed by the Barometre Moneycorp 2020 estimate that they will reach the turnover of 2019 in 2022.
Asked about the estimate for the foreign exchange rate at the end of 2021, 67% of the companies expect a rate euro/leu of 4.95-5 lei, 16% see the euro over the level of 5 lei and only 17% under the level of 4.95 lei.
The experts in Moneycorp appreciate that,for Romania,the perspectives are positive in general, especially in the context where our country is going to benefit from a financial package which is unprecedented from the EU, of over 80 billion euro.
According to the second edition of the Moneycorp Barometre regarding the economic situation, made between 1 and 8 December, 63% of the over 1,000 companies interviewed expect that the economic recovery is going to follow the shape of the letter ‘K’, 15% estimate an evolution under the shape of ‘U” or ‘W’ and only 7% estimate a rapid upgoing,under the form of ‘V’.
The results of the barometre, in the context of moderate optimism regarding the perspective of the economy, show that most companies (61%) expect that they will reach the level of the turnover of 2019 in 2022 only, 15% estimate they will recover in 2021 the turnover of 2020, while 23% estimate that in business, in 2021, they will follow a stable trend, without being influenced by the effects of pandemics ( in general, the companies which had to gain during the pandemics).
Asked when they anticipate the national campaign for vaccination for 70% of the Romanian population is finalised, 57% of the companies showed Q3 2021, and 34% of the companies indicated Q4 of next year. The pandemics affected,firstly, the sales of the companies in Romania, situation mentioned by 64% of the interviewed ones.
The growth of the costs with supply and logistics (48%), the increase of the average duration for bills collection (43%), the issues connected to operational efficiency –telework, interaction with clients (37%), management of human resources (loss of human resources, difficulties in drawing personnel) – 33% and the total interruption of activity due to lockdown (31%) were among the main consequences of the economic corona crisis.
Asked which were the solutions adopted to manage the economic effects generated by the pandemics, all companies mentioned a series of measures which were taken simultaneously, the most important being the reduction of investments (63%) and 50% chose the reduction of operational costs (rents, leasing, etc.).
The list of measures included also the optimisation of costs of foreign exchange rates and international payments (58%), outsourcing non-essential services (41%), the reduction of salaries for a period of determined time (21%) technical unemployment (19%), and the reduction of the number of employees, in line with the reduction of the activity (13%).
Interesting is the fact that only 17% of the interviewed companies used the financial aid from the state, and as regards the impact of the relaunching programmes, only 5% considered them as having a significant impact on the business dynamics.
Asked at what level the turnover of the companies is going to be budgeted in 2021 against 2020,most of them (61%) stated that they will keep it at the level of 2020, estimated before the crisis. 19% estimate a growth of the turnover by 25% while 18% expect an advance of up to 10 percent.
‘According to the barometre, 2021 will be better from the economic point of view than 2020. This does not mean that, once with the overcoming of the sanitary crisis, the economy will recover very soon. It will take some time, as many of the supply circuits have been damaged this year, and the financial blockage got stronger. This is why most companies (61%) estimate they will reach the turnover of 2019 in 2022’ Claudiu Ghebaru, senior corporate dealer with the company.
‘Access to European funds, grants for working capital and investments, fiscal measures are first. In an economy as weakly capitalised as the Romanian one, with over 90% of the companies working in the sector of SMEs, having such programmes will be extremely important to shape the economic recovery’ added Cosmin Bucur, managing director with Moneycorp Romania.
A significant role in the dynamics of the economy will be played by the evolution of the foreign exchange rate. In 2020, 36% of the companies transferred the costs of the leu depreciation in the final price towards the consumer. For 2021, 40% of the companies who participated in the survey, seem to be willing to use solutions for the management of the foreign exchange risk, hedging instruments.
Asked about the estimate of the foreign exchange rate at the end of 2021, 67% of the companies expect a rate euro/leu of 4.95 – 5 lei, 16% see euro over the level of 5 lei and only 17% under the level of 4.95 lei.
When referring to the dollar, 56% expect that the dollar be quoted at the end of 2021 at the level of 4.20 – 4.30 lei, 18% estimate 4.10 – 4.20 lei, while 13% consider the fact that the American currency will pass over 4.30 lei.
The Moneycorp barometre was made with the support of the consultancy company Frames between 1 and 8 December, on a group of over 1,000 companies in diverse domains, such as IT&C, Insurances, Industrial Equipment, FMGC or Tourism, partners and collaborators of Moneycorp Romania.
The profile of the interviewees was represented by middle and top management, with higher education, 63% men and 37% women, average age – 41 years old.
Present since 2016 in Romania, Moneycorp has been the biggest payment institution in Europe.