EMPLOYERS' ASSOCIATION PRESENTS BUSINESS OPTIMISM INDEX PROJECT

ZAGREB, Nov 21 (Hina) - The Croatian Employers' Association (HUP) and consulting company "Tau" have launched a project on the calculation of the Croatian index of business optimism - IPO. IPO is the indicator of the trust of business people in Croatia's economy for the coming period and is therefore a good indicator of the basic macroeconomic variables, Tau director Nenad Bakic told a news conference in Zagreb on Tuesday. The IPO index, which ranges from 0 to 100, will be calculated monthly in a poll procedure providing quantity data on the aspects of the current and future economic situation. Important here is not the absolute amount of the index but its relation toward its previous values. The index will enable investors to gain insight in the potential and prospects of the market and entrepreneurs' stands and expectations before the announcement of the official statistical data. The first IPO poll, which included more than 40 companies (20 big and 20 medium and small-sized companies), has established a decrease in business optimism in comparison to the situation three months ago. Employers are most pessimistic as regards the possibility of obtaining means for business operation. The major factors decreasing business optimism include high interest rates and the tax policy as well as corruption. Contrary to public opinion, business people have put inflation and the kuna exchange rate relatively low on the scale of factors jeopardising business optimism. According to HUP director Zeljko Ivancevic, the HUP will present its monthly reports on IPO movements on its web site. (hina) rml