Business climate continues to be unfavorable. No significant changes are recorded in 1999- 2002:
- More than three quarters of managers perceive property rights as insecure;
- 86% of managers perceive regulations as unclear;
- “Time tax” is more than 13% of working time;
- About 70% of firms pay bribes to get “things done”;
- Unpredictability of bribe’s size is high and increases over time;
- About 25% of the firms are unsure about corruption outcome;
- Implicit corruption increases over time;
- Firms continue to avoid about 25% of taxes;
- Competitive pressure from domestic and foreign producers to raise;
- Budget constraints become harder;
- Tolerance of tax arrears remains high;
- Most significant improvement in performance results is recorded for 2001;
- Investment activity is growing slowly;
- Profit remains the main source of investment, though the role of banks loans is increasing;
- Almost 2/3 of the firms perceive current period of time to be unfavorable for investment;
- Only about 15% of the firms have implemented strategic restructuring measures;
Small enterprises vs large firms:
- Lower perceptions of ability of judicial system to enforce commercial contracts;
- Lower level of state interference;
- Higher perceptions and better dynamic concerning clarity / predictability of regulations;
- Lower absolute level and better dynamics of “time tax”;
- Higher exposure to corruption and higher average size of bribes;
- Higher uncertainty of corruption outcome;
- Lower importance of informal relations with representatives of state authorities;
- Lower level of state subsidization;
- Harder budget constraints;
- Lower investment activity.