What stands out from the Global Capital Confidence Barometer?
In the EY Global Capital Confidence Barometer, EY Transactions Advisory Services annually asks hundreds of companies from various sectors about their economic forecasts and interest in future M&A deals. A new edition of this survey was published in October 2019. What stands out from the answers?
Geopolitical and financial factors have a fundamental impact on the business plans for company managers. As part of the Global Capital Confidence Barometer, we seek answers to the following questions:
- What are companies doing with their funds in times of economic growth or recession?
- How do they raise capital for new investments and/or mergers and acquisitions?
- How do companies prepare themselves against financial setbacks?
From the most recent issue of this survey, we have drawn the following conclusions which apply to Belgium.
No current threat of recession
We can see that, in Q3, the economy in Belgium has not grown quite as fast as it did in the previous quarters. Companies are becoming more cautious and are focusing on their core activities, are more careful when making investments and are setting funds aside as a buffer against financial setbacks.
But there is no question of any (imminent) recession on the Belgian market. Despite the slowdown, various sectors are still experiencing some growth and the current rate of growth is 1.2%.
If we make the connection with M&A deals, it becomes evident that Belgian companies have become more critical when considering mergers and acquisitions. As already noted, the focus is on the core business rather than scouting for new opportunities and markets.