The NAFI Business Climate Index has increased by 8.9 points since 2016 and in 2019 it was 22.2 points (100 is the maximum value of the index, -100 is the minimum). Since 2017, the value of the Index has remained virtually unchanged, remaining in the range from 21.9 to 23.3 p. Entrepreneurs give satisfactory assessments of the current financial situation of their business and are cautiously optimistic about the dynamics of the financial situation in the future.

Business climate index in 2019

The NAFI Business Climate Index* has increased by 8.9 points since 2016 and amounted to 22.2 points in 2019 (100 is the maximum value of the index, -100 is the minimum). Since 2017, the value of the Index has remained virtually unchanged, remaining in the range from 21.9 to 23.3 p. Entrepreneurs give satisfactory assessments of the current financial situation of their business and are cautiously optimistic about the dynamics of the financial situation in the future. This is evidenced by the data of the All-Russian survey of entrepreneurs conducted by the NAFI Analytical Center in April 2019.*

The Business Climate Index is an assessment by entrepreneurs of the current financial position of their company and an estimate of how its financial position may change in the next three months. The NAFI Analytical Center has been studying the business climate and financial well-being of small and medium-sized businesses in Russia since 2015: then the value of the Business Climate Index was 18.5 points. In 2016, the Index fell to 13.3 points, in 2017 it rose to 21.9 points. In 2018-2019, the value of the Index remains stable (23.3 and 22.2 points, respectively).

The highest value of the Index is among companies engaged in wholesale and retail trade and repair of motor vehicles (25 p.). The Index is lower for companies conducting real estate transactions, including realtors (18.6 points), manufacturing industries (18.0) and construction companies (14.9).

Today, 31% of Russian entrepreneurs assess the financial situation of their business as “good” or “very good”: The proportion of entrepreneurs who hold this view has decreased compared to last year. 44% of respondents consider the financial situation of the company to be “average” (an increase of 3 percentage points compared to 2018). Every fourth entrepreneur (25%) negatively assesses the current financial position of his company. The leaders of small and medium-sized enterprises (49% and 38%, respectively) more often consider the company's current financial position to be “good”. Among representatives of microbusiness, 29% think so.

A third of entrepreneurs (34%) believe that the financial situation of their company will not change next year, 42% expect an improvement in the financial situation, 15% – deterioration. There were no significant differences in forecasts between enterprises of different sizes.

Timur Aimaletdinov, Deputy General Director, NAFI Analytical Center:

“Small business is still in a difficult situation – the difficult economic situation in the country has reduced demand in most industries, there has been an increase in the tax burden, under the pressure of sanctions, difficulties with entering foreign markets continue.

At the same time, state support for entrepreneurship is gaining momentum, subsidy programs are being developed, tax and supervisory holidays are being extended, and bank deposit insurance for legal entities has recently been introduced. All these measures are designed to help the development of small business in Russia and make it more attractive, including for those who are just planning to start their own business.”

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*NAFI Business Climate Index (NBCI) is based on a survey of 500 entrepreneurs. Industry distribution according to Rosstat. The index is an assessment of the company's current financial position and an assessment of how the company's financial position may change in the future. Each question involved a 5-point scale and the answer option Difficult to answer. The balance sheets are then calculated.
The balance estimates of the current situation are the share of entrepreneurs who chose the options “Very good” and “Rather good”, minus the share of entrepreneurs who chose the options “Very bad”, “Rather bad”.
The balance estimates of future expectations are the share of entrepreneurs who chose the options “Will improve significantly” and “More likely to improve”, minus the share of entrepreneurs who chose the options “Will significantly worsen”, “More likely to worsen”.