BUSINESSMEN in the Philippines have turned out to be the most bullish globally, according to a press statement released on Tuesday by P&A Grant Thornton that summarized findings of Grant Thornton’s International Business Report (IBR) for the first half, even as net optimism was down one and nine points from 2018’s first and second semesters, respectively.
Data attached to the press release showed the Philippines with a net 73% of respondents optimistic about the outlook of the economy in the next 12 months, topping 34 other countries and besting Southeast Asia’s net 45%, Asia Pacific’s net 26% and a global net 32% that was a three-year low.
Launched in 1992, the IBR reflects views and expectations of 4,928 respondents in 35 countries in the first half — drawn from online and telephone interviews conducted in November last year with chief executive officers, managing directors, chairmen and other senior executives — of whom 642 were in Southeast Asia and 105 were in the Philippines.
Saying that “[t]he market’s expectations for the Philippine economy are very encouraging,” Maria Victoria C. Españo, chairperson and chief executive officer of P&A Grant Thornton, noted that the country “is one of the fastest-growing” emerging markets that is expected to post a compound annual growth rate of 5.35% — “higher than the growth rate for Southeast Asia as a whole” — to $434 billion by 2023 from $331 billion in 2018.
The past 12 months saw 49% of Philippine respondents grow revenue by more than five percent, 37% increase staff by more than five percent and 18% increase exports by more than five percent.
At the same time, 37% of Philippine respondents said economic uncertainty constrains businesses’ ability to expand, 37% cited labor costs, 35% cited shortage of orders, 34% cited regulations and red tape, 33% cited shortage of finance, 29% cited quality of transport infrastructure, while 26% cited availability of skilled workers.
In terms of specific business expectations, the Philippines posted its best reading — third behind Nigeria (89%) and Vietnam (80%) — in projecting profitability to increase over the next 12 months with a net 77%.
Among others, the Philippines was also:
• fourth with a net 70% — behind Nigeria (84%), India (75%) and Indonesia (74%) — in terms of expecting information technology investment to increase in the next 12 months;
• sixth with a net 66% — behind Nigeria (90%), Indonesia (79%), Vietnam (76%), South Africa 73% and India (67%) — in expecting revenue to increase;
• second with a net 62% — behind Nigeria (72%) and Vietnam (64%) — in terms of expecting investment in plants and machinery to rise;
• fourth with a net 62% — behind Vietnam (70%), Nigeria (69%) and India (64%) — in expecting to hire more workers;
• fourth with a net 61% — behind Nigeria (89%), South Africa (67%), as well as Vietnam and India (each with 66%) — in terms of investing more to improve staff skills;
• fifth with a net 61% — behind Nigeria (77%), South Africa (70%), as well as Vietnam and India (each with 67%) — in terms of expecting to step up research and development;
• second with a net 57% — in a tie with South Africa and behind Indonesia (69%) — in expecting selling prices to increase;
• and fourth with 50% — behind Nigeria (62%), Vietnam (57%) and India (56%) — in terms of expecting investment in new buildings to rise. — Katrina T. Mina