Pinoys buoyant; traders less confident, says poll

Filipinos generally expressed optimism in two survey results released during the weekend, but confidence among busi­nessmen went down substantially in the third quarter.

A Social Weather Stations (SWS) third-quarter survey showed 46 percent as optimistic on the economy, against 3 percent of respondents expressing pessimism for a net +43 percent optimism.

The results of the SWS survey, conducted from Sep­tember 24 to 27, showed that many Filipinos anticipate an improved quality of life and a better economy in the next 12 months.

Net optimism about the economy, on the other hand, scored a net +44, as more respondents foresee an improve­ment in the economy, in general.

But business outlook on the economy turned less opti­mistic in the latest survey of the Bangko Sentral ng Pilipinas (BSP), with the overall confidence index (CI) declining to 39.8 percent, compared to 45.4 percent in the third-quarter survey.

The BSP said the sur­vey results indicated that the number of pessimists increased but were still less than the optimists during the quarter. The CI is computed as the percentage of firms that answered in the affir­mative, less the percentage of firms that answered in the negative, with respect to their views on a given indicator.

The BSP’s Business Ex­pectation Survey (BES) was conducted during October 3 to November 17 among ex­ecutives of 1,470 firms na­tionwide.

The survey showed that despite the usual uptick in demand during the Christ­mas season, business out­look was less buoyant due to perceived concerns over the direction of foreign policies and economic reforms in the country, weakening global demand, foreign-exchange losses of importers due to the peso depreciation, and lack of supply of raw materi­als.

For the first quarter of next year, business confi­dence also weakened but remained positive with the in­dex declining to 34.5 percent during the quarter, from 56.8 percent in the previous sur­vey.

Respondents attributed their less optimistic outlook for the first quarter to the usual slowdown in consum­er demand after the holiday season.

For the less optimism, they cited the direction of for­eign policies and economic reforms in the country, stiffer competition, with the entry of new players in the market, and the wait-and-see attitude of investors for the coming year following the results of the US national elections, which could affect the inter­est-rate movements in the country.

The outlook of traders was less upbeat, outweighing the more bullish sentiment of domestic-oriented firms.

The outlook of firms in the wholesale- and re­tail-trade sector was also less positive. The optimism of trading firms due to the typical surge in demand in the fourth quarter was damp­ened by uncertainties in the direction of the government’s policies on foreign affairs and economic reforms as well as stiffer competition.

Likewise, the expecta­tions of businesses in the ser­vices sector turned less opti­mistic for the current quarter due to the lower confidence of firms in business activities, community and social ser­vices, financial intermedia­tion, and real-estate sub-sec­tors, the survey showed.

The views of firms from these sub-sectors were af­fected by concerns over the country’s foreign relations, foreign-exchange losses due to the peso depreciation, and the shift to the K-to-12 program, which reduced the usual college enrolment during the second semester.

Meanwhile, transporta­tion firms registered the high­est CI across the services sub-sectors as they expect an increase in tourism ac­tivities and higher volume of passengers during the holi­day season.

Similarly, firms engaged in hotel and restaurant activi­ties were more bullish largely on account of robust demand for the same period, the sur­vey showed.

Firms in the industry sec­tor also have mixed views for the current quarter. Mining and quarrying and manu­facturing firms were broadly less optimistic mainly due to issues on the government’s foreign policy and econom­ic agenda, the typical slack in demand for industrial ser­vices and equipment such as steel products and fabrica­tors in the fourth quarter due to the holiday season.

Meanwhile, firms in the agriculture, fishery and for­estry and electricity, gas and water sub-sectors were bull­ish because of robust de­mand during the harvest and Christmas seasons, more favorable farming condi­tions with the end of El Niño, and increase in government spending.

Despite expectations of accelerated government spending on infrastructure projects, construction firms were less upbeat on account of lower income and unclear policies on the awarding of new construction projects.

For the next quarter, the outlook across sectors and sub-sectors was generally less optimistic, with the usual slack in demand after the hol­iday season, except for the construction sector whose sentiment improved on ex­pectations of upcoming new projects. LUIS LEONCIO