The expansion now also involves industrial firms mainly producing for the domestic market. Contributory factors have included the improvement in borrowing conditions and the temporary fiscal incentives in force since the end of 2015. According to our estimates, the incentives could increase investment by 2.5 percentage points overall in 2016–17. The decline in lending to firms has virtually halted.
Banks are actively seeking to use the abundant liquidity at their disposal, above all by lending to firms in a stronger financial position and operating in the manufacturing sector. The cost of credit has come down appreciably for both large and small firms. In relation to GDP, however, investment is still far below its pre-crisis levels, at historical lows.