Academic literature on the topic 'Retail trade industry'

Retail is an important industry of each national economy. In the EU, it is an important source of employment and significantly contributes to the GDP creation. Moreover, almost one fifth of all companies are registered in retail industry. In the past decade, retail industry is changing from applying domestically oriented towards internationally oriented business strategies. The importance of large companies is this industry is growing, too. Retail trade concentration process is recognized in all EU countries. In this paper, some of prevailing trends in retail industry are analyzed and explained. The analysis includes EU countries and Croatia as EU candidate country.

Using a unique data set, the authors examine the role of manufacturer and retailer characteristics in the joint determination of trade promotion budgets for supermarket brands and their allocation across trade promotion types. They find that manufacturer variables, such as brand position in retailer product category and brand price premium, and annual retailer sales determine trade promotion budgets. Furthermore, retail companies with larger shares of private labels in product category sales, larger annual sales, and stronger brand positioning are able to increase the allocation of promotional funds to off-invoices and decrease allocation to performance-based trade promotions, such as scanbacks/ accruals and billbacks. Manufacturers with formal trade promotion policies tend to decrease allocation to off-invoices. The authors discuss marketing policy implications of this study and provide research directions.

The scientifi c article deals with the organization of the functioning of retail retail companies. The possibility of using marketing tools in personnel management in the "Trade" industry is shown. Recommendations are given for the formation of key Performance Indicators (KPI) when evaluating the quality of professional tasks performed by employees in the industry. The analytical basis confi rming the signifi cance, relevance and need to adjust the terms of use of the KPI system in the Trade industry was the offi cial information posted on the websites of retail retail companies and customer reviews of the Austin LLC, Zolla LLC and Gloria Jeans JSC store chains. The scientifi c article presents the author’s subjective opinion on the degree of customer satisfaction with the organization of the functioning of retail retail companies included in the research base

The primary purpose of this article is to discuss the trade practices used by retail chains from the point of view of the possible solutions of conflicts between the members of the distribution channel, which have an influence on selling prices for the end users. It is based on the knowledge of the theory of the transaction cost analysis, which makes it possible for the members of the distribution channel to make decisions on the number of forms of the organization in order to realize their activities successfully. In this framework and using the example of milk, the article shows the trade practices of retail chains to improve the relationships manufacturer – retailer in the Slovak consumer market.

The current paper analyzes the reasons behind the difficulties of the Italian olive oil industry to compete in the world markets. The analysis highlights that these complexities can be related with two core factors: stagnant demand in the main producer/consumer countries and strong competition arising from the Spanish olive oil industry increasingly involved also in processing and trade. In addition, these weakness factors are boosted by the market power exerted by large retail chains that are now the main channel in which olive oil is retailed in the domestic market.  

The trade is the most important area of forming and stabilizing of consumer market, the coordinating link in the system of cross-sectoral, regional and interregional links and the efficient mechanism of meeting social needs. Retail trade performs the range of important functions in providing the socio-economic development of a region, rational distribution of production forces and resources and forming of financial-investment capacity of territories’ balanced and sustainable growth. However, lack of effective regional policy leads to the shortfall in GRP and industry income, growing problem of import dependency, reduced employment, revenues and labour remuneration, etc. The paper aims to evaluate current condition and trends of retail trade development and to define preconditions of efficient use of innovations in retail trade. Development condition and trends of retail trade in stores are analyzed, the problems of their development are defined and preconditions of efficient use of innovations in retail trade are outlined. Considering innovative development as the process of positive qualitative changes in innovative condition of an enterprise is characterized. Innovations in retail trade are classified by types. Efficient ways to develop retail trade innovations taking into account the crisis situation and to realize them in perspective are suggested. The article proves that trade is one of the most successful areas for introduction of innovations. Innovations introduced in retail trade will not be neglected by consumers and their efficient use improves the efficiency of stores’ activity.

Abstract: The Financial Service Modernization Act of 1999 has been crucial to the financial service industry ever since its creation. There are two primary reasons this Act was mandated to aid the financial service industry- the merger/barrier reason and consumer privacy reason. This paper evaluates whether this policy has achieved this object and how the effect the policy has had on the financial service industry compares to the non-policy effect on wholesale trade industry, retail trade industry and service industry. This paper finds that this policy is one of the significant reasons, If not the primary reason, for the increase in the Enterprise Value (EV) of firms within the financial service industries over the industries. Furthermore, the findings suggest that customer complaints may have lessened within the financial service industries more than Wholesale and Retail trade industries but not the service industries.

This paper proposes an investigation of the trend concerning both to innovation in the field of retail trade and involvement of technology in streamlining the purchasing process, starting from the example given by Amazon- that is, implementing artificial intelligence and sensor-based systems in cashless stores, Amazon Go. The purpose of this scientific approach is to understand the influence of technological developments within the retail field and to analyze the current state of innovation in this industry for a possible shaping of the future buying experience.

For a long time, the industries were stronger than retailers, due to its strong brands and multinational range, while retailers were small national companies. A research made with ten executives from the industries showed that in recent years this situation has changed. Pressured for the retailers, now stronger, the industries are having fall in its results. In order to improve this situation, industries reviewed the marketing mix, customizing it to retailers needs. Products and prices were developed for each channel and trade marketing investments increased its values. Organizational structure was adapted to this approach, and industries implemented trade marketing.

The objectives of this paper seek to know how sustainability concept and implementation of the retail industry in Indonesia based on sustainability theoretical framework. The research was conducted in Jakarta (Indonesia), the survey was carried out on the basis of questionnaire that was used as a support during the interviews. A total of 137 Indonesia retail enterprises were involved in the research. The results achieved highlight, how CSR does make business sense in Indonesia context. This process calls for new forms of collaboration involving firms along the supply chain, local authorities, the international player and civil society. The conclusion of this research how CSR become a mandatory requirement for access to the International market, transform itself into a new type of technical barrier to trade. CSR need to be fostered rather than imposed through the creation of innovative partnership and locally rooted solution

Deregulation as an open market system is likely to be implemented in the Petroleum industry of South Africa. To secure the success of the retail petroleum industry by means of business and job opportunities one has to investigate the current evolution of the industry and what factors will have a measurable impact on the retail petroleum industry.

This research investigates the determinants of retailer power within retailer-manufacturer relationships by specifying and testing three models of retailer power. It is based on a sample of 55 Irish food manufacturers and their experiences of relationships with Irish and British retailers. The study adopts the view that the existing body of research into relationships with retailers is fragmented, and that a more complete understanding of these power relations may be obtained by simultaneously focusing on three sets of factors. The factors are industry specific, firm and product specific, and relationship specific. Much of the existing empirical work investigating power relations implicitly assumes power to be unidimensional through the measures employed. Consequently, the current study investigates retailer power, measured as a unidimensional construct. However, the work proceeds to explicitly acknowledge that power is multidimensional by examining retailers' power over manufacturers' product related and margin related activities. In examining these two dimensions of power, findings ofa more strategic nature are obtained. The analysis draws on the importance French and Raven (1959) attributed to observability as a determinant of power. While neglected throughout the power literature, observability, by introducing monitoring activities, provides a bridge with the transaction cost literature. In this way, specific investments, and the role of retailers' branding strategies, are incorporated into our study of power. The relationship between retailers' monitoring activities and power is specified. Proceeding from monitoring activities, the analysis sheds light on the determinants of inter-firm integration between retailers and food manufacturers. The role of specific investments, symmetric dependency, brand portfolio and retail influence on price are highlighted. The analysis of retailers' product related power supports the role of retail concentration, product shelf-life, manufacturer specific investments and retailers' product monitoring activities. Examining retail margin related power points to the importance of retail concentration, own brand penetration, the importance of economies of scale in manufacturing, product shelf life and manufacturer specific investments. Finally, retail power, measured as a unidimensional construct, is found to be related to own brand market penetration, the importance of economies of scale in manufacturing, manufacturer specific investments and retailers' monitoring activities.

Assignment (MEcon)--University of Stellenbosch, 2001.
ENGLISH ABSTRACT: The field study reported here examined the importance of branding in the low cost retail industry. Two low cost retailers were identified, who sell boys grey school trousers. The one retailer sells the trousers with a brand name, while the other doesn't sell the grey school trousers with a brand name. Sales volumes of both retailers were drawn for a certain period and questionnaires were developed and sent to the different shops to be completed by the customers to determine how important brands were to them. The results of the research indicated that the retailer selling grey school trousers with a brand name sold more units than the retailer selling the grey school trousers without a brand name. Furthermore, the customers indicated that they would buy grey school trousers with a brand name rather than buying grey school trousers without a brand name,
AFRIKAANSE OPSOMMING: Die navorsing wat hier gerapporteer word, ondersoek die belangrikheid van handelsmerke in die lae-koste kleinhandel industrie. Twee lae-koste kleinhandelaars is geidentifiseer wat grys skool langbroeke vir seuns verkoop. Die een kleinhandelaar verkoop die grys skoollangbroek met 'n handelsnaam, terwyl die ander kleinhandelaar nie die broek met 'n handelsnaam verkoop nie. Verkoopsvolume data vir 'n sekere periode is van beide kleinhandelaars getrek en vraelyste is ontwikkel en na die winkels gestuur. Die klient moes die vraelys voltooi om te bepaal hoe belangrik handelsmerke vir die klient is. Die resultate van die studie het daarop gedui dat die kleinhandelaar wat die grys skool langbroek met die handelsmerk verkoop, meer eenhede verkoop het as die kleinhandelaar wat die grys skool langbroek sonder handelsmerk verkoop. Verder het die klient aangedui dat die grys skool langbroek met 'n handelsnaam eerder gekoop sal word as 'n grys skoollangbroek sonder handelsmerk.

AbstractThis chapter is based on an internal evaluation of the of the 2012–2019 cooperation between the Pakistani National Trade Union Federation (NTUF), the German humanitarian organisation medico international, and the Berlin-based European Center for Constitutional and Human Rights (ECCHR). Written from a first-person perspective by three members of these organisations, it offers invaluable insights into the internal coordination and strategic deliberations of the partners’ evolving transnational efforts to hold the German retail company KiK and Italian social auditing firm RINA to account on behalf of the survivors and victims’ families of the 2012 Ali Enterprises factory fire. The authors elaborate on the multi-dimensional effects and aftermath of the Ali Enterprises tragedy, and recount the lessons learned from their different perspectives as trade unionists, activists, and lawyers based in both Pakistan and Germany. On this basis, the chapter then maps additional possible avenues for supporting the transnational struggles of workers around the globe. All in all, it offers rich insights into the experiences and complex debates ongoing amongst the authors and their organisations on how to develop common positions and further enhance their mutual understanding in order to collectively imagine and work towards transformative political goals.

The increasing popularity of religious tourism in the last century is undeniable. This type of tourism presents a complex conceptualization process due to the religious, spiritual, and cultural connotations. From this perspective, the main objective of this chapter was to develop a characterization of the population dedicated to the retail trade of religious souvenirs in the parish of El Cisne, where the pilgrimage of the Virgin of “El Cisne” takes place every year, in the canton Loja. The methodology used for this study centered on a socio-economic characterization of the owners of these retail stores. These retailers were classified into two comparative groups, which were used to determine the variables that had the greatest impact on the quality of life for them and for their families. Among the main results, it was highlighted that this retail activity came from a traditional practice, from whom a very large number of them were not affiliated to any social security system. There was also evidence of the high participation of women as owners of these businesses.

Abstract The Canadian wine industry has a relatively short, yet successful, history. Beginning in the 1970s, two parallel policy tracks emerged: the first is a sector development one, and the second a retail and trade one. Together they fostered the development of the industry, especially at the domestic level, by modernizing the cultivation and wine-making processes and by supporting the increased demand for Canadian products both domestically and internationally. The sector, marked by a complex set of actors that are often in only partial policy alignment and have diverse goals, has developed through three temporal stages: Emergence (1970s–1995), Expansion (1996–2005), and Maturity (2006 onward) and, in the latter, the booming domestic wine consumption has drawn attention to a policy regime that—largely in the hands of provincial authorities—has been criticized for creating a series of impediments to trade and fair access to the provincial market. Policy shifts are being imposed by Canada’s international trade commitments and by the evolution of the industry itself—this will have important effects on the policy latitude of the actors and likely will rewrite some of the approaches that the provincial governments have been relying on for the past decades.

Abstract Alcohol producers are large, consolidated, very profitable, and politically influential corporations. The industry nexus also includes the digital platforms and other marketing actors such as owners of global sporting events and the industry’s public relations agencies. Marketing to both consumers and stakeholders is a necessary part of industry activity to recruit and reinforce drinkers, normalize the use of alcohol products, and legitimize the industry’s role in the policy arena. Transnational alcohol corporations (TNACs) have a strong financial incentive to maximize profit by maintaining heavy drinking occasions and expanding numbers of drinkers in emerging alcohol markets has led to successful opposition to effective alcohol policy. Retail increasingly involves large corporations, such as superstores, and online purchase and delivery are expanding, exacerbated by the coronavirus disease (COVID-19) pandemic. Globalization of the alcohol industry over the four past decades has been facilitated by trade and investment agreements and the highly profitable nature of alcohol products. TNACs, particularly the largest beer and spirits producers, have—through investments, mergers, and acquisitions—expanded into low- and middle-income countries (LMICs) in Latin America, Asia Pacific, the Middle East, and Africa, and these have become increasingly important for their global markets.

The business of payments and the provision of payment instruments have a rich history, which can be drawn upon in a discussion of standardization. In the middle-ages, for example, the mere existence of a wide variety of foreign and local coins led to a flourishing business of money exchange offices and cashiers in the Netherlands. Malpractices of some of these firms, mostly in the form of physical tampering with coins and alloy, resulted in government regulation on a municipal and province level. Yet, as these type of regulations where hard to enforce, the Amsterdam municipal government decided in 1609 to establish a municipal exchange bank, ‘de Amsterdamse Wisselbank’, originally as a government monopolist. The motivation for doing so was to prevent the regular price-increases of the good coins, to eliminate confusion to the public and to facilitate trade by providing good coins. Later on, in 1621, the regulations were adapted to the actual business practice and private cashiers were allowed – under certain conditions – to conduct business in the city of Amsterdam (van den Berge, 1939, p 34). The example shows us how a diversity of specifications and a diversity of payment instruments, will lead to the development of separate companies which make money by reducing the confusion for their consumers. It illustrates that the abuse of technological know-how and abilities for the sake of increased economic benefits by a few private companies may lead to government intervention for the sake of public interest. Furthermore it indicates that strong market powers may prevail, even in the case of restricted government regulation. As such the example contains all relevant issues with respect to IT-standardization: • can it be assumed that the market will standardize if necessary? • what role should governments play in this process? • does the end-user play a role in this process? In this chapter, I will examine the above standardization issues with respect to the retail payment instruments, developed and in use since the beginning of this century. In this time frame bank notes and coin have been widely available to the public as a basic (and standardized) payment instrument. I will however not include these instruments in this study and limit myself to a study of the standardization of noncash payment instruments that have been available to the consumer. These payment instruments can be seen as the technical means with which consumers effect money transfers to each other. Examples of payment instruments are the forms for credit transfers or in-payments, the debit- or credit cards or home-banking software. It is my opinion that, given the availability of cash an alternative payment instrument, the standardization processes of noncash payment instruments can be seen as the ‘pure’ result of market forces. The study of this process, applied to different types of instruments within one application and industry domain, will hopefully provide additional insight.

India has seen a phenomenal growth and occupies the top three positions in production from last decades in production of horticulture produce, dairy and meat products over the last decade. But at present, India's share in global farm trade is still very small even with such large production volumes. This is mainly caused due to lack of cold chain infrastructure which includes both storage and transportation facilities. The cold chain industry in India is still at a nascent stage and despite large production of perishables, the cold chain potential still remain untapped due to high share of single commodity cold storage, high initial investment (for refrigerator units and land), lack of enabling infrastructure like power & roads, lack of awareness for handling perishable produce and lapse of service either by the storage provider or the transporter leading to poor quality produce. Cold chain systems are crucial to the growth of global trade in perishable products and to the worldwide availability of food and health supplies.

India, as the second largest internet population after China with 330-370 million users which is expected to grow by at least 50 million yearly until 2020, is at the cusp of a digital revolution. Various reports show that India's revenue in the online travel booking segment amount to 569 million USD in 2018 and is expected to show an annual growth rate of 14.6% resulting in a market volume of 9,594 million USD in 2022. This article emphasizes the opportunities and challenges of online travel agencies (OTAs) particularly in India. For the success of e-tourism in India, it is essential to increase the operational efficiency of the staff and attitude/ behavior of the staff, delivery of services as committed, provision of customer data management and insurance coverage services. All of these are the keys for an excellent and prompt service delivery system and which effects the success of the online travel provider. A large youth population, changing lifestyle, plethora of travel deals and authenticated travel related information are some of the major opportunities and challenges for e-travel commerce in India. This article summarizes information on the challenges and opportunities of Indian online travel agencies, with a conviction that India will make a huge break through and be a success story particularly in online travel retail. This study will give insight to the industry players to understand the opportunities and challenges and develop strategies for retaining more satisfied users and increasing the number of repeat customers accordingly.

Retail trade occupies an important part of the life of society because it is directly aimed at satisfying its needs as a consumer and is a source of material wealth for the seller. This sphere of activity is an independent branch of the national economy, which has emerged because of commodity exchange processes designed to meet the various needs of human society. Everyone of society, as a result of the implementation of exchange operations, has the opportunity to receive for the final individual use what he needs. The seller, in pursuit of his own benefit, relieves the manufacturer of the need to search for a buyer for his products. From this point of view, the role of retail trade in the reproduction cycle is extremely important, since, specializing in specific operations, this industry is not only an intermediary, but also a catalyst for mutually beneficial interaction of all participants in these relationships. Virtually everyone in both developed and developing countries is involved in retail operations on a daily basis.

This paper aims to propose an innovative idea of an embedded intelligent, multimedia and interactive shop system where embedded vision systems can analyse human behaviours around shelves for interactivity and statistical purposes, mostly devoted to customer behaviour analysis, planogram maintenance and out of stock detection. We discuss the need for new services into the shop, involving consumers more directly and instigating them to increase their satisfaction and, as a consequence, their purchases. To do this, technology is very important and allows making interactions between costumers and products and between customers and the environment of the shop a rich source of marketing analysis. In particular we focus on concepts of monitoring and interactivity, introducing several emerging technologies in the field of retail environments. The main novelty of the paper is the general architecture of the system together with the introduction of a series of intelligent embedded systems, yet implemented and tested in a dataset recorded during the EuroShop trade fair, in cooperation with Grottini group, a leading company in Retail Design industry based in Italy. Results are convincing and most of all the general architecture is affordable in this specific application.

The main purpose of economic research is to monitor the per­formance of a particular national economy and analyse the factors that determine its growth and fluctuations. Gross domestic product is primarily used to assess the performance of the economy. It is, however, also neces­sary to look at the labour market situation. COVID-19 pandemic is one of the factors that have impacted the Slovak economy and the labour market situation. The purpose of the paper is to evaluate the changes in the labour market and the performance of the Slovak economy in connection with the COVID-19 pandemic. The pandemic has resulted in lower economic perfor­mance. Particularly affected were the accommodation and food service activities, wholesale and retail trade as well as the manufacturing industry. Consequently, the labour market situation reflected these phenomena in decreased employment and increased unemployment rates.

This article indicates the results of studies of the effect of various doses of mineral fertilizers with trace elements based on pure silicon – “Nanosilicon” – on the productivity of soybean plants. Soya is a unique crop in its specificity. It is widely used in the food industry, both in the process of human food production, and in the production of animal feed. Silicon is the second most abundant element in the lithosphere of our planet. It increases stress resistance of plants, improves absorbing capacity of the root system, helps plants to retain moisture in the dry period, and strengthens the cell walls of plants. In general, the result was positive regardless of the amount of the preparation used, so the yield increased on average by 12.9 %, oil collection – by 12.8 %, and protein collection – by 15.1 %.

1.1 Macroeconomic summary Economic recovery has consistently outperformed the technical staff’s expectations following a steep decline in activity in the second quarter of 2020. At the same time, total and core inflation rates have fallen and remain at low levels, suggesting that a significant element of the reactivation of Colombia’s economy has been related to recovery in potential GDP. This would support the technical staff’s diagnosis of weak aggregate demand and ample excess capacity. The most recently available data on 2020 growth suggests a contraction in economic activity of 6.8%, lower than estimates from January’s Monetary Policy Report (-7.2%). High-frequency indicators suggest that economic performance was significantly more dynamic than expected in January, despite mobility restrictions and quarantine measures. This has also come amid declines in total and core inflation, the latter of which was below January projections if controlling for certain relative price changes. This suggests that the unexpected strength of recent growth contains elements of demand, and that excess capacity, while significant, could be lower than previously estimated. Nevertheless, uncertainty over the measurement of excess capacity continues to be unusually high and marked both by variations in the way different economic sectors and spending components have been affected by the pandemic, and by uneven price behavior. The size of excess capacity, and in particular the evolution of the pandemic in forthcoming quarters, constitute substantial risks to the macroeconomic forecast presented in this report. Despite the unexpected strength of the recovery, the technical staff continues to project ample excess capacity that is expected to remain on the forecast horizon, alongside core inflation that will likely remain below the target. Domestic demand remains below 2019 levels amid unusually significant uncertainty over the size of excess capacity in the economy. High national unemployment (14.6% for February 2021) reflects a loose labor market, while observed total and core inflation continue to be below 2%. Inflationary pressures from the exchange rate are expected to continue to be low, with relatively little pass-through on inflation. This would be compatible with a negative output gap. Excess productive capacity and the expectation of core inflation below the 3% target on the forecast horizon provide a basis for an expansive monetary policy posture. The technical staff’s assessment of certain shocks and their expected effects on the economy, as well as the presence of several sources of uncertainty and related assumptions about their potential macroeconomic impacts, remain a feature of this report. The coronavirus pandemic, in particular, continues to affect the public health environment, and the reopening of Colombia’s economy remains incomplete. The technical staff’s assessment is that the COVID-19 shock has affected both aggregate demand and supply, but that the impact on demand has been deeper and more persistent. Given this persistence, the central forecast accounts for a gradual tightening of the output gap in the absence of new waves of contagion, and as vaccination campaigns progress. The central forecast continues to include an expected increase of total and core inflation rates in the second quarter of 2021, alongside the lapse of the temporary price relief measures put in place in 2020. Additional COVID-19 outbreaks (of uncertain duration and intensity) represent a significant risk factor that could affect these projections. Additionally, the forecast continues to include an upward trend in sovereign risk premiums, reflected by higher levels of public debt that in the wake of the pandemic are likely to persist on the forecast horizon, even in the context of a fiscal adjustment. At the same time, the projection accounts for the shortterm effects on private domestic demand from a fiscal adjustment along the lines of the one currently being proposed by the national government. This would be compatible with a gradual recovery of private domestic demand in 2022. The size and characteristics of the fiscal adjustment that is ultimately implemented, as well as the corresponding market response, represent another source of forecast uncertainty. Newly available information offers evidence of the potential for significant changes to the macroeconomic scenario, though without altering the general diagnosis described above. The most recent data on inflation, growth, fiscal policy, and international financial conditions suggests a more dynamic economy than previously expected. However, a third wave of the pandemic has delayed the re-opening of Colombia’s economy and brought with it a deceleration in economic activity. Detailed descriptions of these considerations and subsequent changes to the macroeconomic forecast are presented below. The expected annual decline in GDP (-0.3%) in the first quarter of 2021 appears to have been less pronounced than projected in January (-4.8%). Partial closures in January to address a second wave of COVID-19 appear to have had a less significant negative impact on the economy than previously estimated. This is reflected in figures related to mobility, energy demand, industry and retail sales, foreign trade, commercial transactions from selected banks, and the national statistics agency’s (DANE) economic tracking indicator (ISE). Output is now expected to have declined annually in the first quarter by 0.3%. Private consumption likely continued to recover, registering levels somewhat above those from the previous year, while public consumption likely increased significantly. While a recovery in investment in both housing and in other buildings and structures is expected, overall investment levels in this case likely continued to be low, and gross fixed capital formation is expected to continue to show significant annual declines. Imports likely recovered to again outpace exports, though both are expected to register significant annual declines. Economic activity that outpaced projections, an increase in oil prices and other export products, and an expected increase in public spending this year account for the upward revision to the 2021 growth forecast (from 4.6% with a range between 2% and 6% in January, to 6.0% with a range between 3% and 7% in April). As a result, the output gap is expected to be smaller and to tighten more rapidly than projected in the previous report, though it is still expected to remain in negative territory on the forecast horizon. Wide forecast intervals reflect the fact that the future evolution of the COVID-19 pandemic remains a significant source of uncertainty on these projections. The delay in the recovery of economic activity as a result of the resurgence of COVID-19 in the first quarter appears to have been less significant than projected in the January report. The central forecast scenario expects this improved performance to continue in 2021 alongside increased consumer and business confidence. Low real interest rates and an active credit supply would also support this dynamic, and the overall conditions would be expected to spur a recovery in consumption and investment. Increased growth in public spending and public works based on the national government’s spending plan (Plan Financiero del Gobierno) are other factors to consider. Additionally, an expected recovery in global demand and higher projected prices for oil and coffee would further contribute to improved external revenues and would favor investment, in particular in the oil sector. Given the above, the technical staff’s 2021 growth forecast has been revised upward from 4.6% in January (range from 2% to 6%) to 6.0% in April (range from 3% to 7%). These projections account for the potential for the third wave of COVID-19 to have a larger and more persistent effect on the economy than the previous wave, while also supposing that there will not be any additional significant waves of the pandemic and that mobility restrictions will be relaxed as a result. Economic growth in 2022 is expected to be 3%, with a range between 1% and 5%. This figure would be lower than projected in the January report (3.6% with a range between 2% and 6%), due to a higher base of comparison given the upward revision to expected GDP in 2021. This forecast also takes into account the likely effects on private demand of a fiscal adjustment of the size currently being proposed by the national government, and which would come into effect in 2022. Excess in productive capacity is now expected to be lower than estimated in January but continues to be significant and affected by high levels of uncertainty, as reflected in the wide forecast intervals. The possibility of new waves of the virus (of uncertain intensity and duration) represents a significant downward risk to projected GDP growth, and is signaled by the lower limits of the ranges provided in this report. Inflation (1.51%) and inflation excluding food and regulated items (0.94%) declined in March compared to December, continuing below the 3% target. The decline in inflation in this period was below projections, explained in large part by unanticipated increases in the costs of certain foods (3.92%) and regulated items (1.52%). An increase in international food and shipping prices, increased foreign demand for beef, and specific upward pressures on perishable food supplies appear to explain a lower-than-expected deceleration in the consumer price index (CPI) for foods. An unexpected increase in regulated items prices came amid unanticipated increases in international fuel prices, on some utilities rates, and for regulated education prices. The decline in annual inflation excluding food and regulated items between December and March was in line with projections from January, though this included downward pressure from a significant reduction in telecommunications rates due to the imminent entry of a new operator. When controlling for the effects of this relative price change, inflation excluding food and regulated items exceeds levels forecast in the previous report. Within this indicator of core inflation, the CPI for goods (1.05%) accelerated due to a reversion of the effects of the VAT-free day in November, which was largely accounted for in February, and possibly by the transmission of a recent depreciation of the peso on domestic prices for certain items (electric and household appliances). For their part, services prices decelerated and showed the lowest rate of annual growth (0.89%) among the large consumer baskets in the CPI. Within the services basket, the annual change in rental prices continued to decline, while those services that continue to experience the most significant restrictions on returning to normal operations (tourism, cinemas, nightlife, etc.) continued to register significant price declines. As previously mentioned, telephone rates also fell significantly due to increased competition in the market. Total inflation is expected to continue to be affected by ample excesses in productive capacity for the remainder of 2021 and 2022, though less so than projected in January. As a result, convergence to the inflation target is now expected to be somewhat faster than estimated in the previous report, assuming the absence of significant additional outbreaks of COVID-19. The technical staff’s year-end inflation projections for 2021 and 2022 have increased, suggesting figures around 3% due largely to variation in food and regulated items prices. The projection for inflation excluding food and regulated items also increased, but remains below 3%. Price relief measures on indirect taxes implemented in 2020 are expected to lapse in the second quarter of 2021, generating a one-off effect on prices and temporarily affecting inflation excluding food and regulated items. However, indexation to low levels of past inflation, weak demand, and ample excess productive capacity are expected to keep core inflation below the target, near 2.3% at the end of 2021 (previously 2.1%). The reversion in 2021 of the effects of some price relief measures on utility rates from 2020 should lead to an increase in the CPI for regulated items in the second half of this year. Annual price changes are now expected to be higher than estimated in the January report due to an increased expected path for fuel prices and unanticipated increases in regulated education prices. The projection for the CPI for foods has increased compared to the previous report, taking into account certain factors that were not anticipated in January (a less favorable agricultural cycle, increased pressure from international prices, and transport costs). Given the above, year-end annual inflation for 2021 and 2022 is now expected to be 3% and 2.8%, respectively, which would be above projections from January (2.3% and 2,7%). For its part, expected inflation based on analyst surveys suggests year-end inflation in 2021 and 2022 of 2.8% and 3.1%, respectively. There remains significant uncertainty surrounding the inflation forecasts included in this report due to several factors: 1) the evolution of the pandemic; 2) the difficulty in evaluating the size and persistence of excess productive capacity; 3) the timing and manner in which price relief measures will lapse; and 4) the future behavior of food prices. Projected 2021 growth in foreign demand (4.4% to 5.2%) and the supposed average oil price (USD 53 to USD 61 per Brent benchmark barrel) were both revised upward. An increase in long-term international interest rates has been reflected in a depreciation of the peso and could result in relatively tighter external financial conditions for emerging market economies, including Colombia. Average growth among Colombia’s trade partners was greater than expected in the fourth quarter of 2020. This, together with a sizable fiscal stimulus approved in the United States and the onset of a massive global vaccination campaign, largely explains the projected increase in foreign demand growth in 2021. The resilience of the goods market in the face of global crisis and an expected normalization in international trade are additional factors. These considerations and the expected continuation of a gradual reduction of mobility restrictions abroad suggest that Colombia’s trade partners could grow on average by 5.2% in 2021 and around 3.4% in 2022. The improved prospects for global economic growth have led to an increase in current and expected oil prices. Production interruptions due to a heavy winter, reduced inventories, and increased supply restrictions instituted by producing countries have also contributed to the increase. Meanwhile, market forecasts and recent Federal Reserve pronouncements suggest that the benchmark interest rate in the U.S. will remain stable for the next two years. Nevertheless, a significant increase in public spending in the country has fostered expectations for greater growth and inflation, as well as increased uncertainty over the moment in which a normalization of monetary policy might begin. This has been reflected in an increase in long-term interest rates. In this context, emerging market economies in the region, including Colombia, have registered increases in sovereign risk premiums and long-term domestic interest rates, and a depreciation of local currencies against the dollar. Recent outbreaks of COVID-19 in several of these economies; limits on vaccine supply and the slow pace of immunization campaigns in some countries; a significant increase in public debt; and tensions between the United States and China, among other factors, all add to a high level of uncertainty surrounding interest rate spreads, external financing conditions, and the future performance of risk premiums. The impact that this environment could have on the exchange rate and on domestic financing conditions represent risks to the macroeconomic and monetary policy forecasts. Domestic financial conditions continue to favor recovery in economic activity. The transmission of reductions to the policy interest rate on credit rates has been significant. The banking portfolio continues to recover amid circumstances that have affected both the supply and demand for loans, and in which some credit risks have materialized. Preferential and ordinary commercial interest rates have fallen to a similar degree as the benchmark interest rate. As is generally the case, this transmission has come at a slower pace for consumer credit rates, and has been further delayed in the case of mortgage rates. Commercial credit levels stabilized above pre-pandemic levels in March, following an increase resulting from significant liquidity requirements for businesses in the second quarter of 2020. The consumer credit portfolio continued to recover and has now surpassed February 2020 levels, though overall growth in the portfolio remains low. At the same time, portfolio projections and default indicators have increased, and credit establishment earnings have come down. Despite this, credit disbursements continue to recover and solvency indicators remain well above regulatory minimums. 1.2 Monetary policy decision In its meetings in March and April the BDBR left the benchmark interest rate unchanged at 1.75%.