According to the analyst Daniel Thorniley, who is specialized in the macroregion of Central and Eastern Europe, Africa and Near East, the economic situation of Poland, Czech Republic and Hungary will be definitely better in comparison to other developing economies against the global economy.
The region of Central Europe recorded a twofold increase in GDP growth in comparison to the West of the continent. For instance, Czech Republic was developing at a pace of 4.3 per cent in the third quarter of this year. The GDP growth in Poland increased by 3.4 per cent and the GDP growth in Hungary – by 2.3 per cent. According to prognoses of the World Bank, countries of Central Europe reached the GDP growth at the level of 3.3 per cent. From the business point of view concerning risk management, the markets of Central Europe are very interesting. In spite of the fact that Poland is a big market, the best solution would be to combine these five markets in a cluster. It could compensate the results of the crisis in Russia, Ukraine and Turkey – says Dr Daniel Thorniley, Chairman of the Board in DT-Global Business Consulting.
According to the expert, Poland has much to offer. A strong position of the SMEs as well as the increasing number of family enterprises contribute to the fact that foreign investors are more and more interested in the native market. Austerities are scarce in Poland and the Polish banking sector functions better in comparison to others. Polish companies invest much more than other companies from around the world and money orders from Poles working in the western part of Europe and other parts of the world are sent to Poland. These are positive factors for the economy – says Dr Daniel Thorniley. However, it does not mean that Poland is an easy market and that there are no problems here. Since it is an attractive market, it also becomes brutally competitive, which has an impact on a price war – explains Thorniley.
According to the expert, the Ukrainian and Russian conflict did not have a significant impact on the economies of Central and Eastern Europe. Several years ago such markets as Czech Republic and Hungary, which were in recession then, would have experienced it very severely. At present, the major part of these markets – including Poland – is recording a growth escalating between 2.5. and 3.3. per cent and the minimal loss of GDP is not so substantial – judges Daniel Thorniley.
A totally different and worse image is related to the countries from the old European Union, especially from the eurozone. It is confirmed by the polling conducted among financial directors and associated members of ACCA (Association of Chartered Certified Accountants). The GECS (Global Economic Conditions Survey) index, which has been systematically increasing till the end of 2012, reached the 0 value at the end of the second quarter of 2015, whereas three months later it decreased to the level of -25 points. The declining optimism has an influence on activities taken by companies. 40 per cent of financial directors from global enterprises decided to limit investments in the third quarter of this year. The similar percentage of managers who stopped the recruitment of new employees and started job cuts was noticeable in that period.
Lack of investments and location of profits on baking accounts are one of the crucial problems of the largest economies in the eurozone. The eurozone may reach the growth at the level of 1.5. per cent this year. Although this year has been the most prosperous year for a very long time due to economic situation (since there has been a decrease in oil prices and Euro exchange rate as well as increase in consumption), it does not mean that the eurozone is doing well, especially taking tragic events in Paris, migration challenges or situation of Volkswagen into consideration – emphasizes Thorniley.