Using International Ranks and Business Activity Indicators for Economic Development Forecasting

The majority of countries use several well-known integral indicators for economic forecasting purposes, on which basis these countries’ ranks in the global economic community are computed. Apart from allowing investors to make investment decisions, such indicators and ranks help in forecasting economic development in forthcoming periods. The best known of them is Ease of Doing Business Index and Global Competitiveness Index. The less known ones are indicators of Business Tendency Surveys (BTS), computed on the basis of data obtained from questionings of enterprise managers in various economic sectors and from studies of consumer sentiments. Yet, specialists tend to use the data from these conjuncture surveys to analyze the current economic situation in a country (total or by industry) and build short-term forecasts. Apart from the survey indicators depicting quite clearly a situation in the economy, the most popular ones in Europe are Confidence Indicators for enterprises by economic activity, and Economic Sentiment Indicator incorporating the indicators from BTS of enterprises and consumer sentiments. These indicators are computed by the European Commission for EU member countries on monthly basis. The article shows changes in Doing Business ranks for selected EU member countries and Ukraine. BTS indicators for industrial enterprises (estimate of production capacities; estimate of change in the production orders; estimate of the competitive position of enterprises at the internal market) are analyzed for some of these countries. A comparison of the dynamics of production capacities utilization, business confidence indicators and Doing Business rank is made for Ukraine and Bulgaria. The prognosticating capacities of BTS indicators compared with Doing Business indicator are analyzed.