For the first quarter of 2022, business confidence in Georgia decreased (by 13.3 index points) and reached 17.3. The highest decrease in business confidence is observed in service (-25.8), manufacturing (-20.8), and wholesale and retail trade (-16.1) sectors. The negative change in BCI for Q4 2021 was driven by worsened future expectations and past performance.
The Past Performance Index, which considers the business sector's assessment of their own economic performance in the previous quarter, decreased by 15.6 points compared to Q4 2021 and reached 13.1 for Q1 2022, with service (-46.7), and manufacturing (-41.6) sectors showing the greatest deterioration.
Expectations Index, which reflects business optimism, decreased further, amounting to 23.3 index points. Expectations for Q1 2022 decreased for all sectors, except for the construction and agriculture sectors.
The Sales Price Expectations Index decreased by 13.4 index points and reached 30.7, indicating a decrease in the share of businesses that anticipate charging higher prices on their products over the next three months. The Sales Price Expectations Index has decreased for all sectors except for the service sector.
Limited access to financing and a lack of demand continue to be the most significant obstacles for SMEs. Meanwhile, limited access to financing and shortage of qualified labour force is indicated as one of the major constraints by large companies.