Small industries perform well, but financial situation worsens, points out CNI

2023-05-03 15:10:30

Even with a performance above the annual average, businessmen do not have good expectations for the rest of the year, citing interest rates and the tax burden as the main problems

Rodrigo Felix Leal/AEN-PRAnalyst says that problems reduce business confidence, which affects other issues, such as investments and hiring

As interest rates e tax burdens high levels were the main problems for micro and small industrial companies in the first quarter of 2023. Even so, the segment managed to maintain a good performance, according to the Small Industry Overviewmeasured by National Confederation of Industry (CNI). In the first three months of the year, small businessmen reported a performance evaluated at 44 points, better than the historical average for the year, which is 43.8. The performance index analyzes the volume of production and the evolution of hiring in companies. The performance index may even have been satisfactory, but three other surveys indicate that businessmen do not have good expectations. It is more difficult to get credit, this causes problems, such as less investment and hiring. O Financial Situation Indexcalculated based on operating profit margin, financial situation and access to credit, fell to -39.3 points, the worst number since the first quarter of 2021.

CNI’s Policy and Industry analyst, Paula Verlangeiro, analyzes the scenario. “The main problems of the first quarter of 2023 were the high tax burden and high interest rates. They were at the top of the rankings. But, in addition, other problems, such as insufficient domestic demand, also stood out a lot. Due to the slowdown in economic activity, less demand is occurring. Because of this, businessmen are reporting this problem”, said Paula. They also fell Confidence Index of Industrial Entrepreneur of Small Industries and the Perspectives Index. “The industrial entrepreneurs showed that the financial conditions are worse. The Index is calculated based on operating profit margin, financial condition and access to credit. In addition, entrepreneurs showed that they are less confident, which generates a greater waiting period, that they wait longer when making decisions such as investments and hiring. It ends up affecting other issues”, continues the analyst. The Performance Index analyzes production, number of employees and use of industrial capacity.

*With information from reporter Misael Mainetti