The war is not affecting the turnover forecasts of Catalan companies. 80% expect to increase turnover this year, despite the war in Ukraine having mitigated the recovery that had started strongly after the end of the pandemic. In addition, almost half, 47%, expect to grow by more than 5%. This is stated in the latest report Perspectivas Catalunya 2022, carried out by KPMG in collaboration with the CEOE.
The partner responsible for KPMG in Catalonia, Francisco Gibert, has stated that, although the economic forecasts of Catalan executives are more pessimistic than a few months ago, their expectations regarding turnover, investment and hiring continue to be positive. Their forecasts for corporate operations have not been affected either, taking into account the foreseeable rise in interest rates they will have to face, in response to a level of inflation not seen in decades.
To prepare the report, responses were collected in two surveys, with the aim of including the impact that the Russian invasion has had on the business plans of Catalan companies in the short term. The first was carried out between December 2021 and February 2022, and the second, between April and May of this year. It stands out that only 34% of respondents have revised their strategy for the current year, while 47% have not yet done so, waiting to see how it evolves. It should be noted that the survey quantifies that only 20% of entrepreneurs have been affected by the sanctions imposed on the Russian Government and the counter-sanctions decreed by it, such as the closure of access to the SWIFT framework or the prohibition of carrying out transactions with Russian banks.
All in all, hiring and internationalization forecasts also remain optimistic. In the case of staff increases, the plans of Catalan entrepreneurs have moderated in the second survey, falling by ten points, but remain positive, as 48% will increase their team. In addition, the percentage of respondents who will cut staff falls from 12% to 9% and that of entrepreneurs who will keep it the same increases by 12 percentage points. The international presence of companies will also be strengthened, with 36% opting to expand it and 42% maintaining it.
The most significant change brought about by the war in Europe has been in how respondents view the evolution of the economy in the next 12 months. Business owners who expected the Spanish economy to perform better or much better before the conflict in the first survey has almost halved in the second, dropping from 55% to 28%. Likewise, those who believe it will evolve worse or much worse has grown by 25 points, from 14% to 39%, this being the majority opinion among Catalan companies that participated in the survey.
Business owners who believe the economy will evolve worse have gone from 14% to 39%, this being the majority opinionThe main threat hovering over the Spanish economy is the inflation recorded in recent months, with the consequent increase in production costs and reduction in purchasing power. So much so that three out of four executives point to it as the primary danger for businesses. In this sense, three out of five respondents (61%) believe that the increase in production costs will be the main impact, while 49% indicate that disruption in the supply chain will be. Only 34% believe it will affect sales.
The list of dangers is followed by the weakening of the global economy (51% of respondents) and problems in the supply chain (42%). Geopolitical tensions also climb positions, having increased 16 percentage points between both surveys, now being pointed out as one of the possible drags on growth by 29% of entrepreneurs.
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