Lower costs and new products determined industrial growth in November

The work of previous months found a positive reflection in the data of processing industry: the optimization of production costs and development of new products (e.g., in food, wood, pharmaceutical industries) have given rise to opportunities for entering new markets as well as opportunities for domestic-demand oriented branches to reorient themselves to exporting.

Even though the domestic demand continued to drop substantially, production in November exceeded the levels recorded in the previous months (according to seasonally adjusted data) by 11.6%. The annual growth rate was still slightly negative (-2.6%), which was determined by the rapid recession in the processing industries at the beginning of 2009, however, since February of 2009 when the lowest point in processing industry production was registered, the production has grown 15.9% over nine months.

As of last April, a consistently improving situation in the processing industry sector has been observed. In characterizing the situation, entrepreneurs' assessment of export opportunities has been improving monthly, as a result of both growing foreign demand and improved competitiveness of products.

It is important to note that over the month, increased production was registered by a majority of industries, moreover, the growth was very much pronounced in many of them.

As for future developments, the weak domestic demand and limited access to financing will no doubt continue to impede the development of production in the near future, however, foreign demand for our products and continued improvement in competitiveness is likely to result in growth in the processing industries in 2010. The representatives of branch associations likewise relate the potential for development solely with export opportunities.