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The state of infrastructure has improved in the Dnipro region unlike the ease of doing business

01/ 12/ 2021
  According to the EBA survey in the Dnipro region, 5% of respondents said that it is easy for them to do business whereas last year there was no such opinion. However, it is difficult to talk about improvements – most still assessed the conditions for doing business in the region as satisfactory (43%), difficult (33%), and very difficult (19%). The integrated value of the index amounted to 2.34 points out of 5 possible. Thus, 67% of respondents believe that the conditions for business in the region have not changed over the past six months, 29% say that doing business has become more difficult, and only 5% believe that it has become easier. According to the survey, corruption (24%), bureaucracy (22%), lack of rule of law (18%), and complicated relations with the authorities (18%) have the worst impact on business development in the Dnipro region. Also comparing to 2020, the number of those unsatisfied with the state of infrastructure has significantly decreased (8% compared to 18% last year). Therefore, this year the number of satisfactory assessments of the state of infrastructure increased to 57% (again 48% last year). Meanwhile, the positive assessments have increased – up to 24%. And only 19% state that the infrastructure is in poor condition, compared to 46% in 2020.  Regarding the improvement of infrastructure, 44% of entrepreneurs consider the construction of an airport in the region a priority. Then a large gap follows with the reconstruction of roads (24%), modernization of railways (17%) and development of river transportation (10%). Interestingly, last year the airport was second in priority (22%) and roads were first (46%). We also asked entrepreneurs to rate the work of regional authorities on a 5-point scale. It turned out that business evaluates local government representatives mostly neutrally: regional administration – 3.76, regional traffic police – 3.35, National Police – 3.4, city council – 3.33, regional customs – 3.33, courts – 3.14. This situation is very different from other regions, where there are almost equal neutral and negative assessments. The business has the most complaints about the work of the state environmental inspectorate which was given a rather low score – 2.75. More than half of entrepreneurs, namely 52%, consider the level of development of e-services in the region satisfactory. At the same time, 24% say that everything is good in the region with the development of e-services, all others believe that it is poorly/ very poorly developed. As for expectations in the next six months, 62% of entrepreneurs believe that the business climate will not change, 14% believe that the business climate in the region will deteriorate, and 24% will improve. Among the TOP-3 greatest expectations for 2022, the business named reducing pressure from regulatory authorities, improving the judicial and law enforcement system, as well as simplifying permitting procedures and the provision of administrative services. What do business representatives plan for 2022? More than half of entrepreneurs, namely 52% are not ready to invest in large-scale projects next year, but the other 48% have such plans. The vast majority, namely 67% plan to hire new employees, while 10% plan to lay off staff. Also, 81% of entrepreneurs plan to increase the salaries of employees, and 19% will leave it unchanged.   For reference:  The survey was conducted among the member companies of the EBA Dnipro from October 19 to November 16, 2021. The press release is available at the link.

According to the EBA survey in the Dnipro region, 5% of respondents said that it is easy for them to do business whereas last year there was no such opinion. However, it is difficult to talk about improvements – most still assessed the conditions for doing business in the region as satisfactory (43%), difficult (33%), and very difficult (19%). The integrated value of the index amounted to 2.34 points out of 5 possible.

Thus, 67% of respondents believe that the conditions for business in the region have not changed over the past six months, 29% say that doing business has become more difficult, and only 5% believe that it has become easier.

According to the survey, corruption (24%), bureaucracy (22%), lack of rule of law (18%), and complicated relations with the authorities (18%) have the worst impact on business development in the Dnipro region. Also comparing to 2020, the number of those unsatisfied with the state of infrastructure has significantly decreased (8% compared to 18% last year).

Therefore, this year the number of satisfactory assessments of the state of infrastructure increased to 57% (again 48% last year). Meanwhile, the positive assessments have increased – up to 24%. And only 19% state that the infrastructure is in poor condition, compared to 46% in 2020. 

Regarding the improvement of infrastructure, 44% of entrepreneurs consider the construction of an airport in the region a priority. Then a large gap follows with the reconstruction of roads (24%), modernization of railways (17%) and development of river transportation (10%). Interestingly, last year the airport was second in priority (22%) and roads were first (46%).

We also asked entrepreneurs to rate the work of regional authorities on a 5-point scale. It turned out that business evaluates local government representatives mostly neutrally: regional administration – 3.76, regional traffic police – 3.35, National Police – 3.4, city council – 3.33, regional customs – 3.33, courts – 3.14. This situation is very different from other regions, where there are almost equal neutral and negative assessments. The business has the most complaints about the work of the state environmental inspectorate which was given a rather low score – 2.75.

More than half of entrepreneurs, namely 52%, consider the level of development of e-services in the region satisfactory. At the same time, 24% say that everything is good in the region with the development of e-services, all others believe that it is poorly/ very poorly developed.

As for expectations in the next six months, 62% of entrepreneurs believe that the business climate will not change, 14% believe that the business climate in the region will deteriorate, and 24% will improve.

Among the TOP-3 greatest expectations for 2022, the business named reducing pressure from regulatory authorities, improving the judicial and law enforcement system, as well as simplifying permitting procedures and the provision of administrative services.

What do business representatives plan for 2022? More than half of entrepreneurs, namely 52% are not ready to invest in large-scale projects next year, but the other 48% have such plans. The vast majority, namely 67% plan to hire new employees, while 10% plan to lay off staff. Also, 81% of entrepreneurs plan to increase the salaries of employees, and 19% will leave it unchanged.

 

For reference: 

The survey was conducted among the member companies of the EBA Dnipro from October 19 to November 16, 2021. The press release is available at the link.

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