Large companies in Latvia are more optimistic than their Lithuanian and Estonian peers regarding business opportunities in 2018
Latvian companies are the most optimistic regarding the business opportunities in 2018 among their Baltic peers. 61% of CFOs in Latvia are convinced that year 2018 will be favourable for their business.
Survey of Chief Financial Officers conducted by SEB bank indicates that Latvian companies are the most optimistic regarding the business opportunities in 2018 among their Baltic peers. 61% of CFOs in Latvia are convinced that year 2018 will be favourable for their business, while this view is shared by 54% Lithuanian and 43% Estonian financial experts.
Survey of Chief Financial Officers conducted by SEB bank indicates that Latvian companies are the most optimistic regarding the business opportunities in 2018 among their Baltic peers. 61% of CFOs in Latvia are convinced that year 2018 will be favourable for their business, while this view is shared by 54% Lithuanian and 43% Estonian financial experts.
More than two thirds (67%) of big companies in Latvia expect their turnover to grow. Furthermore, every 10th CFO expects the turnover growth to exceed 10%. Turnover growth is expected by 70% of Estonian and 58% of Lithuanian CFOs. In comparison with previous year, the number of companies expecting turnover growth has increased in all three countries.
Ints Krasts, board member of SEB Latvia: “Three quarters of large companies in Latvia consider themselves financially strong. Over the recent years many of them have accumulated considerable financial buffers, allowing them to feel stable and confident. This optimism is also rooted in strong GDP growth, because its pace is currently fastest over the last six years.”
Main challenge: workforce issues
In comparison with previous year the number of Latvian companies who have named labour costs as their main challenge has doubled. 50% of CFOs in Latvia have said they are concerned about the growing labour costs. This is a #1 issue in Lithuania and Estonia as well, as confirmed by 56% Lithuanian and 51% Estonian Chief Financial Officers.
45% Latvian large companies, 41% Lithuanian and 38% Estonian enterprises are also worried about the availability of qualified workforce. Demand and cost of raw material are also a common issue mentioned by many companies, while few CFOs are worried about availability of financing, interest rates or currency exchange rates.
“Faster growth comes with increased labour costs. However, company ambitions to increase the number of their employees have not grown along with the economy. Instead, large companies in Baltics are looking for opportunities to boost productivity by improving efficiency of their staff and automating production processes. This is a step in the right direction, because many Baltic companies are still behind their European competitors in terms of productivity,” says Ints Krasts.
About the survey
This is the fifth survey of Baltic Chief Financial Officers. Results reveal whether CFOs expect that next twelve months will bring good or bad news for businesses, identify which are the main concerns and challenges, indicate whether businesses plan to expand or decrease their workforce and give an insight in other topics as well. 190 largest companies with annual turnover over 20 million euros from Latvia, Lithuania and Estonia participated in the survey, which was carried out during September of this year.
