33% of executives expect the economic recovery to take a year: what other business expectations are there in 2023?

At the end of 2021, the executives who expected a “worse year” were 28%, and 4% those who expected “a much worse year”; adding both 32%. By 2023, that total has been reduced. “For this year, both categories concentrate 27%. The reading we have of these results is that the situation is expected to change and that Peru will once again have the economic indicators of before”says Giuliana Reyna, general manager of GRM.

Along the same lines, those who expect a year the same as the previous one rises to 55% from 50%, and those who expect a better year go from 16% in 2021 to 17% in 2023.

For Francisco Pujol, national director of BNI Peru, the figures reveal that Peruvian executives and businessmen are seeing the light at the end of the tunnel. “Despite the fact that the political part has affected, they are already seeing that opportunities and markets are opening up. The country has to keep walking.”comment.

Proof of this is that 33% of the executives surveyed -as of January 2023- consider that the economic recovery will take a year, a figure that improves compared to 2021 (31%). The second largest group – 29% – expect it to take at least two years.

The reversal in business sentiment lies mainly in the fact that indicators of economic activity that had been plummeting have begun to stabilize. This is what Gonzalo Galdos, president of IPAE – Acción Empresarial, comments. “The beginning of the year was very hard because the effects of the social upheaval probably generated one of the most difficult moments for the national economy. However, we believe that this will improve throughout the year. slowly and progressivelyExplain.

For example, the tourism sector –one of the most affected– has found new impetus for its long-awaited recovery. Juan Stoessel, CEO of Casa Andina, asserts that Semana Senta was that turning point. “We hope that the second quarter will be good and that by the second semester of 2023, internal, incoming and corporate tourism will grow. Of course, there are always risks. The climate, for example”comment.

Weighing the risks

“We have a political fragility and a weak management capacity in the public sector”, comments Gonzalo Echeandia, independent director. It is these two factors that configure risks and hinder the implementation of long-term public policies. “This also translates into less confidence that generates a drop in private investment and employment”add.

Precisely, the survey reveals that the crisis and the political situation predominate as the main risk for Peruvian companies. A figure that grows considerably compared to previous years [Ver infografía].

On the contrary, risks associated with the performance of the economy have receded. The perception of risk in the face of a market recession falls from 41% in 2021 to 33% in 2022. Today the risk of weather phenomena is added to this list. However, when it comes to perception, Reyna considers that it affects it in a differentiated way. “There are activities that will perform well this year and others that will gradually recover”account.

cautious investment

Bruno Ghio, president of CFA Society Peru, believes that the investment this year will be associated with the movement seen in demand. “The more structural investments such as the expansion of plants are still very specific. But the one associated with the commercial dynamics has managed to unlock itself. As you begin to see more dynamism, you normally invest in more working capital. That investment is the one that will predominate.”add.

According to Wilber Dongo, central business manager of Caja Arequipa, unlike the big company, the Mype sector is dynamic and the placements show it. “With the microcredit in March we have consolidated with S/800 million in placements. Until April 27, we have already placed S/700 million”he warns.

Although he acknowledges that these indicators also respond to a commercial strategy of the business, Dongo assures that it is the internal consumption of the population that motivates the taking of credit by the mype. “80% of the loans are working capital. We are talking about a sector that always seeks to get ahead because behind each microenterprise there is a family that wants to progress. It has to sell. To this, add that the majority of the informal sector buys from the mype. Thus the economic circle is closed”Explain.

Finally, in a challenging and competitive context, investments to gain efficiency are not neglected either. That is where digital transformation predominates, says Sangram Sahoo, CEO of Tata Consultancy Services Peru. “There is a tendency among large and medium-sized companies to shift towards efficiency even a little more than customer experience. In both cases, technological spending continues with the same level of growth”add.