Poland Payment Survey 2019: Robust economic growth has not eliminated payment delays
In 2018, Poland reached apeak in economic recovery with a GDP growth of 5.1%, the highest level of economic expansion since 2011.Despite this positive macroeconomic environment, payment delays appear to be standard practice on the Polish market. Nearly 99% of the Polish companies surveyed by Coface experience payment delays.Only one out of ten companies reportsreceiving payments on time.
Average payment delays decline while sectors show diverse picture
Despitethe economic acceleration, outstanding receivables decreased only slightly in 2018. The average payment delay now stands at59.9 days, which is three days less than in 2017. With payment delays of only 26 days, the textile sector is definitely best-in-class. Once again, the longest payment delays were experienced by transport and construction companies with140 and 105 days respectively. In this regard there was a slight improvement in both sectors compared to 2017, but a deterioration is nevertheless expected forthis year. The highest increase inpayment delay periods was recorded by the retail sector (rising from 15 to44 days).
Positive outlook for Polish businesses
The paymentsurvey investigated businesses’ paymentbehavior, which mirrors both theshort-term economic situation and the more structural business environment.“52% of companies anticipate that their profitability is going to rise within the next six months, whereas 39% anticipate a decrease”comments Grzegorz Sielewicz, Regional Economist Central & Eastern Europe.“The textile, automotive, and energy sectors are expecting an improvement in sales. Conversely, the pharmaceuticals, metals, and construction sectors forecast a decline in sales.”According to Coface’s survey, nine out of twelve sectors envisagethat the amount of outstanding receivables will decrease over the forthcomingmonths.
“The Poland Payment Survey confirms the trendthat is alsobeing experienced in other CEE countries. The robust economic activity could mask the challenges that companies are perceiving”, explains Declan Daly, CEO Coface Central & Eastern Europe. “Strong competition and rising costs have squeezed margins and furthermore this has the consequence of affecting business payment liquidity.With a slowdown in economic growth, companies will operate in a less supportive environment.”
María José SEBASTIAN
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