The purpose of the business climate research carried out by the Institute for Economic and Enterprise Research (IEER) is to provide an empirical study of business surveys conducted on a quarterly basis and analyze the situation of the Hungarian corporate sector, the current state of business, future prospects, and factors affecting the situation of companies. In addition to questions related to the business climate of companies, other issues and problems -- and the reactions of companies to these -- are explored which play an important role in the adaptability of enterprises in terms of financial status and development. October 2011 was the eighth in a series of survey data collected.

In late 2011 Hungarian companies faced very difficult economic circumstances, and as a result no significant improvement is expected for 2012. Currently, a major obstacle for companies to expand their production and marketing activities is a contraction of credit. This unfavourable process was already underway at the beginning of the economic crisis, and in 2011 access to credit became ever more difficult as banks were put into a difficult situation because of the early payoffs of foreign currency based loans and the bank tax.

In the October 2011 survey we asked participating companies about their borrowing habits and their expectations in light of the credit crunch. The results show that because of the deterioration of credit conditions over the past 6 months 7% of the companies surveyed postponed making investments. Changes in the conditions for accessing credit in 2011 were viewed very negatively by Hungarian business leaders. For 28% of respondents it has become more difficult in recent years to obtain a loan. In addition, respondents expect even more difficult conditions for 2012 than in 2011. As a result of these loan conditions, the vast majority of companies surveyed (81%) expressed a very pessimistic outlook and don’t plan to obtain a bank loan in 2012.