The Philippine Star
MANILA, Philippines - The Philippines was ranked third in a global survey on business optimism, reinforcing the renewed confidence of businessmen in the country's economic environment.
The results of Grant Thornton's annual International Business Report (IBR) show that the Philippines was on third spot (with 87 percent) in the optimism ranking behind Chile (95 percent) and India (93 percent).
The IBR is an international survey of the opinions of medium to large privately held businesses (PHBs). The report was released through Grant Thornton's Philippine member firm Punongbayan & Araullo (P&A), one of the country's leading business and legal firm consultancy.
It noted that since the Philippines started participating in 2004, optimism among local business leaders has always tracked an upward trend until 2009, when optimism dropped from a high of 95 percent to 63 percent in reaction to the global financial crisis.
The following year, confidence level marginally improved to 68 percent as business leaders cautiously looked forward to a rebound.
P&A managing partner and COO Marivic Españo said that this positive outlook of Filipino executives should not be viewed as simply in keeping with Filipinos' inherent positive thinking.
"This year, optimism is backed up by the 7.3- percent real gross domestic product (GDP) growth in 2010. That's the highest economic growth rate we have ever experienced, so I would say our optimism is well-founded," Espano pointed out.
The IBR survey also asked respondents about their expectations for their businesses in 2011.
The feedback was that Filipino business leaders perceived improvement across all of the following indicators – employment, revenue, selling prices, exports, profitability, investment in new building, investment in machinery, and research and development.
Employment showed a positive balance of 58 percent, compared to 40 percent last year. Sixty-six percent have plans to invest in plant and machinery, compared to 48 percent in 2010.
Españo said that the 18-point increase in business owners' projection for an increase in their investments in plant and machinery is a good reflection of the private sectors level of optimism.
"This tells us that businesses are looking at putting the gains of last year to even more productive use. Should these plans see fruition, we can expect even more positive results for next year," the P&A executive added.
In its fourth quarter business outlook survey, the Bangko Sentral ng Pilipinas (BSP) said business confidence reached an all-time high of 50.6 percent from 45 percent in the third quarter of 2010.