Azerbaijan's Central Bank has reported a growth in business confidence over the past three months.
CBA General Director Khagani Abdullayev said that the bank compiles a business confidence index on the basis of recommendations of the Swiss National Bank.
The monitoring of business confidence covers some 200 enterprises, 100 in the trade sector, 60 in the non-oil sector and 40 in the service sector. “From each industry we select the largest enterprises in terms of sales volume and number of employees,” Abdullayev said.
“We draw up a composite Business Confidence Index. This includes six or seven key indices. We conduct polls on the volume of sales in the past three months, new orders (for enterprises in the trade and industrial sector), and expectations for prices and sales for the next three months. Each index has its own specific weight. The composite indicator is a good sign of business conditions in the country.”
Abdullayev said that businesses in the trade sector expect sales to grow in the next three months and correspondingly expect to hire more sales staff. There has also been a reduction in the stock of unsold goods over the past three months, mainly in the non-oil industry. Stocks of unsold cars have remained steady, while stocks of household electrical appliances and furniture have fallen.
"This is mainly linked with seasonal factors," Abdullayev said. "The general composite index has seen a positive trend in the past three months – sales grow and the volume of production grows too.”
Under the methodology used, respondents do not give figures to the Central Bank. They answer “yes”, “no” or “stable” to the bank's questions, Abdullayev said.