LAHORE - Overseas Investors Chamber of Commerce and Industry (OICCI) shared the results of its Business Confidence Index (BCI) Survey - Wave 16, which shows that the overall Business Confidence in Pakistan stands at 14 percent positive, a significant decline from the 21 percent positive recorded in the Wave 15 results announced in November, 2017.

The survey results were largely influenced by the pessimism in the retail and wholesale trade sector which recorded a sharp decline in Business Confidence to positive 6 percent compared to positive 40 percent in the Wave 15.

The confidence of the manufacturing sector was stable at 15 percent positive, while the services sector was bullish at 23 percent positive vs 15 percent in the previous Wave 15 survey.

OICCI BCI survey, conducted every six months, is a comprehensive review of both local and global business aspects and is indicative of the direction in which the economy is moving based on the perceptions of key stakeholders of the business community across the country and representing about 80 percent of the GDP.

Based on respondents feedback, the major factors causing the decline in business confidence was caused by a combination of significantly reduced perceptions of global, country and industry business situation during the past six months and also in the next six months, as well as decreased level of anticipated capital investment, profitability and return on investment over the next six months.

Growing concern on governance and government policies, inflation and security conditions together with pessimism about the future due to upcoming election related political uncertainty and developing energy crises were stated as the leading reasons for the decline of the business confidence.

Commenting on the survey findings, OICCI President Bruno Olierhoek said "the significant decline in Business Confidence is not surprising considering that the country has had many challenges during the past six months like balance of payment crisis, political uncertainty and decline in FX reserves."

Looking ahead, for the next six months, the major reasons identified by Wave 16 survey respondents for decline was in terms of the lower profit and ROI expectations and upcoming political instability expected due to elections. Return of energy crises was also a reason for increasing pessimism about the future followed by concern on the sustainability of the security situation.

Among the positive aspects, was a directional increase in total employees, plans for business expansion, security improvement, expectations of new business alliances (CPEC) and an increase in demand.