April 17, 2024

Taylor Daily Press

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Significant price increases expected in coming months: 'Recession risks very realistic'

Significant price increases expected in coming months: ‘Recession risks very realistic’

Voka President Hans Maertens © BELGA

Flemish companies anticipate significant price increases in the coming months. This is evidenced by a new survey conducted by Voka, the Flemish business network. The combination of rising supply problems and astonishingly high costs for energy, raw materials, and wages is putting our economy on the brakes. “The risk of a recession in the coming months is very real,” warns Foca.

GVsourceBELGA

A poll conducted by Voka earlier this week among 600 Flemish companies showed that 86 percent of companies report that their supplies are out of order. Input costs are 41 percent higher today than they were 6 months ago. Companies expect a further 33 percent increase in input costs in the coming months. As a result, companies expect their sales prices to rise by an average of 10 percent in the coming months. In the past six months, their sales prices have already increased by an average of 12.5 percent.

The combination of supply problems and increased costs is causing a clear negative impact on the activities of Flemish companies. For the whole of 2022, companies expect an average impact of -8 percent. Companies report that investment plans for the next two years will be revised downward by an average of 9 percent. One in six stops new hires. Together with the signs of a global recession, this means that a recession in the coming months is also a realistic scenario for our economy.

This crisis will have a significant impact on the economy after the Corona crisis, which has not yet been fully digested. We risk entering a recession. Foca invites federal social partners and the government to sit down. Measures must now be taken to slow wage increases and stem the spiral of inflation,” says Hans Mertens, CEO of Voca.

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“If we see our wage cost impediment derail, the consequences will be dire. Businesses will run into trouble and this threatens to have consequences for our exports, our investments and therefore our employment as well. The fundamental debate about staggeringly increasing wage costs is becoming more urgent than ever. It should not be Adjusting the pointer mechanism and jumping on the pointer is a taboo in this regard,” concludes Maertens.