The positive business outlook on the Philippine economy improved for the fourth quarter 2019, as the overall confidence index increased to 40.2 percent from 37.3 percent a quarter ago, results of a survey conducted by the Bangko Sentral ng Pilipinas that was released Friday show.
“This was reflective of the higher increase in the percentage of optimists, which outweighed the increase in the percentage of pessimists from the previous quarter’s survey results,” the BSP said.
Respondents attributed their more optimistic sentiment for the quarter to higher consumer demand during the holiday and harvest seasons, increase in sales, orders, and projects, more favorable macroeconomic conditions (higher GDP growth and lower inflation and unemployment rates), higher government spending, mainly in infrastructure, and business expansion.
Companies also cited the anticipated positive impact of the country’s hosting of the 2019 Southeast Asian Games, such as availability of more jobs and an increase in consumer spending.
“The sentiment of businesses in the Philippines mirrored the more buoyant business outlook in Brazil, Chile, Hungary, and the Netherlands. Meanwhile, business sentiments in Bulgaria, Croatia, Greece, Israel, Norway and Ukraine were less optimistic. Canada, China, Denmark, Euro Area, Hong Kong, New Zealand, Singapore, South Korea, Thailand, United Kingdom, and the United States remained pessimistic,” the BSP said.
For the first quarter 2020, the positive business outlook weakened as the next quarter confidence index declined to 40.3 percent from the Q3 2019 survey result of 56.1 percent in Q4 2019.
The less favorable outlook for the first quarter was due mainly to expectations of lower consumer demand after the holiday and harvest seasons, decline in sales and orders, stiffer competition, and other factors, such as rising prices, concerns over the African Swine Flu epidemic and the fishing ban period.
Julito G. Rada
The business outlook on the country’s economy was more positive for the next 12 months, as the CI inched up to 59.6 percent from 58.6 percent in the previous quarter.
“The more optimistic outlook of the respondents for the next 12 months was attributed to expectations of sound macrofundamentals (i.e., more stable economic growth and lower inflation and interest rates), increase in consumer demand, higher government spending on infrastructure, development of new product lines/models and marketing and business strategies, business expansion, and incoming new projects, clients and prospective customers.