OREANDA-NEWS. May 04, 2008. According to the results of the latest Latvian entrepreneurs' business activity research, Parex Index, conducted in March 2008, the majority of entrepreneurs currently have a negative assessment on their business as a result of the slowdown in the Latvian economy, reported the press-centre of Parex.

Responding to the additional question “How has the slowdown of the Latvian economy impacted the activity of your enterprise?” 54,1% of the 750 entrepreneurs surveyed assessed the economic deceleration impact as negative.

The Parex Index has seen the most dramatic fall since its inception in 2004 and for the first time has produced pessimistic results when entrepreneurs assess Latvia's economic situation. In the last quarter entrepreneurs recorded the sharpest decrease in their outlook (-4,47) and from a position of ‘cautious optimism', the index is now below the neutral mark of 50 points at 47,47.

“How the slowdown of the Latvian economy has impacted the activity of your enterprise?”
Only 2,7% of the surveyed respondents noted a positive impact from the economic slowdown with approximately one third of respondents, or 31.1%, indicating no impact on their business activity.

The results show that enterprises situated in rural municipalities and regions have experienced the most negative impact from the economic slowdown (61.2%). Businesses with shared foreign capital have not seen such a strong effect with 11.4% of the surveyed respondents even noting a positive effect.

The most significant fall in the index was observed among companies in the construction sector – 56,8% of the respondents stressed the negative impact towards their business activity. Trade sector entrepreneurs gave almost the same negative assessment with 56% of the respondents indicating a negative impact. Service sector entrepreneurs have assessed the economic slowdown as ‘quite positive'. Nevertheless the majority of the surveyed entrepreneurs (52,2%) believed that the economic situation has worsened.

Only 3,7% of all entrepreneurs believed that the slowdown in economic growth had had a positive effect on their companies.