Editorial: three reasons for becoming more optimistic

08.11.2010, 12:00

Äripäev wrote last week in its editorial that one has to agree with the view of Jüri Käo, one of the country's most powerful businessmen, that it is time to think more positively.

"It seems that now is the time that company managers start thinking about new growth and take steps in this direction. For two and a half years, from the summer of 2008, Estonian business managers have been pessimistic and careful when making forecasts. Now there are at least three reasons to become more optimistic and start thinking about new investents.

First, domestic consumption seems to be past its low point as proven by recent data on retail sales and rise in consumer confidence. The decline in retail trade enterprises that had lasted for nearly two and a half years turned to a rise again in September this year with retail sales growing 1% year on year.

The second reason is Estonia's third-quarter economic growth that will be announced shortly. According to experts, this is likely to be one of Europe's highest growth figures, perhaps as high as 6%, according to the finance ministry forecast. This is based on the decade's highest growth in industrial output and rise in exports. And if large exports such as Ericsson does well, it is good news for tens of Estonian subcontractors and thousands of their employees ranging from electronics to transport industry.

The third reason is business-to-business advertising that is historically a good indicator about the economy's situation, companies' expectations and their readiness to invest. November brought a significant improvement in this area and there is more money on the B2B ad market as before. There are also more ads on job vacancies and news on growth in company investments.

What is encouraging is that Estonian businessmen are focusing more on the business areas where they feel themselves strong. With the help of banks, businessmen have stopped borrowing without second thought and trying to invest from own funds. This change of attitude in loan capital is good news.

Make no mistake - Äripäev is not asking businessmen to lose their sense of reality. It is still important to keep costs under control. Investment decisions and their funding must be based on common sense. But it seems that, in addition to planning for growth, businesses may finally start to take steps in this direction, for instance by increasing the customer base, launching new products or services or by acquisitions.

This may well be the start of a new long-awaited wave. And who of us surfers would not want to be the first to be there when it arrives? It may not be as high as during the boom time, but it will still get us forward.