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Philippines firms most optimistic on economic outlook — survey
MANILA, Philippines — Philippine businesses have the most positive economic outlook among 35 countries even as optimism dipped slightly from a year ago, a survey of independent assurance, tax and advisory firm Grant Thornton showed.
Grant Thornton’s International Business Report showed the Philippines topped the list with a net 73 percent having an optimistic outlook on the economy over the next 12 months.
The same report showed, however, that optimism on the Philippine economy went down by nine percentage points from the same period a year ago.
Taking the second spot on the list was Vietnam with optimism at net 72 percent, while Indonesia placed third with net 66 percent.
Amid the positive outlook on the economy, a net 66 percent of Philippine businesses expect to see higher revenues in the next 12 months.
While those expecting higher revenues in the Philippines slightly dropped by four percentage points from last year, the report showed it was still higher than the average for Southeast Asia at net 59 percent.
Marivic Españo, chairperson and chief executive officer of P&A Grant Thornton, the Philippine member of Grant Thornton International Ltd. said 54 percent of mid-market companies surveyed also intend to expand their business domestically.
In addition, survey respondents anticipate an increase in selling prices, exports, number of people to be hired, investments in buildings, as well as on research and development.
“The market’s expectations for the Philippine economy are very encouraging,” she said.
She said the Philippines, which is expected to grow by about six to seven percent in 10 years, is among the fastest-growing economies in emerging markets.
Grant Thornton International forecasts the Philippine economy to grow to $434 billion by 2023 from $331 billion in 2018, with its compounded annual growth rate of 5.35 percent seen to outpace Southeast Asia as a whole.
This growth, Grant Thornton said, would be driven mainly by the digital economy which is expected to rise to $21 billion by 2025 from just $5 billion currently.
While automation in manufacturing and services could lead to displacement of some 1.5 million workers over the next five years, Grant Thornton expects the Philippine government’s Build Build Build infrastructure development program to make up for the job losses.
This, as construction of new highways, airports, bridges, and ports would bring in $2.47 trillion to the Philippine economy and create employment opportunities for seven million people by 2030.
Grant Thornton also sees strong growth in other sectors such as real estate, banking and finance, entertainment and tourism, and outsourcing which should provide various business opportunities.
“We are serious about making sure that we provide the right infrastructure and the right services to support the growing economy,” Españo said.
Despite the optimistic outlook on the Philippine economy, there are still challenges faced by businesses.
Among the challenges cited are shortage of finance, regulations and red tape, transport and information and communications technology infrastructure, and economic uncertainty.
Source: https://www.philstar.com/business/2019/07/05/1932023/philippines-firms-most-optimistic-economic-outlook-survey#wGSDeeufhqOYJAPO.99