Wednesday , September 28 2022

Conindustria: Nearly 80% of the industry is considering closing within two years


About 80 percent of the industry believes it could close its doors for about two years as a result of the deepening of the economic crisis, according to Conindustria's research for the second quarter of 2018

"This reflects a decline in investment outside of operations (filling up inventories)," says the study. 77% of companies consider the possibility of closing in less than 2 years. Of this figure, 42 percent of the industry said they expected this in a year, while 35 percent would do so in 1 or 2 years.

The data show that 85% of the medium size would do so within two years, while 75% of the big industry plans to do it in 1 or 2 years. And 67 small industries believe that they will close their doors in that term.

One of the aspects highlighted in the qualitative research of the industrial economy is that nearly 50 percent of the industry uses less than 20 percent of its operational capacity.

"The fact that 45% work below 20% is an indication of this strong contraction," said Conindustria president Juan Pablo Olalquiaga.

"91% of companies, after a year, assume that their production is drastically reduced in physical units, which increases estimates of the loss of gross domestic product by more than 20% by 2018," says research

It also notes that 82 percent of companies estimate that their sales will decrease, while only 2 percent expect it to increase.

Regarding the aspects that have most affected the production of company products, these are: low national demand, lack of foreign currency availability, difficulties in accessing raw materials suppliers, uncertainty in political and institutional scenario, and lack of financing.

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