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Surveys cite high business optimism

Posted on September 06, 2016

AMERICAN and other businesses operating in the Philippines have recorded relatively high optimism regarding their prospects despite concerns, according to separate surveys whose results were released to media yesterday.

The 2017 ASEAN Business Outlook Survey of the US Chamber of Commerce and the American Chamber of Commerce in Singapore cited respondents in the Philippines as among “the most optimistic” among those operating in members of the Association of Southeast Asian Nations (ASEAN).

Specifically, while 45% of senior executive respondents operating in Southeast Asia describe the investment environment as improving in their host country, those in the Philippines (77%), Vietnam (72%),and Myanmar (70%) said so, compared to only 23%, 22% and 16% in Malaysia, Thailand and Brunei Darussalam, respectively.

Many respondents across the region also say Vietnam (40%), Indonesia (38%) and Myanmar (34%) continue to be priority markets for future business expansion. Compared with last year, however, respondents this year indicate the greatest increase in interest in expanding into Vietnam (31% to 40%), Indonesia (31% to 38%) and the Philippines (20% to 27%), the survey noted.

At the same time, interest in diversifying investments from China into Southeast Asia “has been gradually decreasing over the years.” Only 11% report plans to diversify investments compared to 15% in 2015. For the Philippines, the percentage dropped to 6% from 10%.

Moreover, while combating corruption remained a top concern by respondents across the region, a higher percentage of respondents in Vietnam (69%), the Philippines (64%) and Singapore (64%) cited this as top priority.

Still, 79% of respondents in the Philippines see profits increasing next year compared to 78% ASEAN-wide, 55% expect their work force to expand this year though only 19% plan to expand locally.

Asked on their views regarding the current administration’s ability to sustain reforms from its predecessor, 2% said they were “very optimistic”, 43% were optimistic, 40% were neutral, while 15% were pessimistic.

The survey was held April 25-May 24 among 519 executives of US firms in Southeast Asia, of whom 53 were in the Philippines.

Yesterday also saw the Management Association of the Philippines (MAP) and Isla Lipana & Co./PwC Philippines release results of their Philippine CEO Survey in time for the 14th MAP International CEO Conference 2016 that will be held today.

Among others, 94% and 93% of chief executive officers (CEOs) surveyed expressed confidence about their company’s revenue growth over the next 12 months and three years, respectively, while over 86% and 85% said so of industry prospects for revenue growth over these periods.

Still, 65% believe there are more threats to their firm’s growth today than three years ago, 79% are worried about overregulation, while 67% said bribery and corruption are a threat.