HONG KONG: Many small businesses around the world, especially in Turkey and the Middle East, plan to boost investment and hiring, a survey showed on Wednesday, at a time when the global outlook is increasingly uncertain.
An index of confidence at small and medium-sized enterprises (SMEs) in 21 markets rose to 118 in the second quarter from 111 in the fourth quarter of 2009, HSBC’s semi-annual global small business confidence monitor showed.
Emerging markets remained more confident than advanced markets, though confidence measures in developed markets rose sharply since the end of 2009.
The survey results suggest fears about a double dip in the global economy that have been dogging financial markets may be overstated, especially since SMEs comprise 95 percent of firms in OECD economies and employ two thirds of private sector workers.
The confidence index for Turkey rose to 138, from 117 in the fourth quarter of 2009, and the north America index climbed to 119 from 107.
However, in a slightly worrying sign, the index for India fell to 121 from 132, driven by an 18 percentage point drop in the share of SMEs that planned to increase investment.
Greater China’s SME confidence stayed flat at 121.
All Asian indexes were in positive territory of above 100 for the first time since the financial crisis.
The survey was conducted in May and June 2010, when the euro zone sovereign debt crisis was raging.
Also, 41 percent of SMEs say they plan to increase capital spending, up four percentage points from the fourth quarter of 2009.
Twenty-six percent of SMEs say they are planning to hire.
In Hong Kong, SMEs are preparing to settle more trade using China’s yuan. Marking the spreading use of the yuan internationally, 48 percent of SMEs said they will have a trade account denominated in yuan in 12 months, compared with 29 percent who have one at present.
Hong Kong has become China’s stage for internationalizing the yuan, which was de-pegged from the US dollar last month.
This week China and Hong Kong tweaked rules to allow companies greater access to yuan funds and financial products, with total yuan deposits expected to grow by 5 billion yuan a month for the rest of the year.