Rice tariffication, EDSA bus ban down business confidence in Q3 2019

Ralf Rivas
Rice tariffication, EDSA bus ban down business confidence in Q3 2019
Business confidence falls to 37.3% in the 3rd quarter of 2019, as bad weather, external shocks, and government policies hit companies

MANILA, Philippines – The business outlook on the economy turned less optimistic for the 3rd quarter of 2019, with the overall confidence index falling to 37.3% from 40.5% in the 2nd quarter, the Bangko Sentral ng Pilipinas reported on Thursday, September 19.

The respondents of the Business Expectations Survey (BES) attributed their weaker sentiment for the quarter to the slowdown of business activities during the rainy season, decline in orders leading to lower sales, lack of supply of raw materials, perceived unfavorable effects of government policies, and stiffer competition.

Respondents deemed unfavorable the impact of rice tariffication and the banning of provincial buses along EDSA

However, businesses were more upbeat for the last quarter of the year, rising to 56.1%, as firms anticipate higher consumer demand during the holiday and harvest seasons, increases in orders and projects, as well as favorable macroeconomic conditions, and higher government spending for the quarter.

Trading firms were less positive as respondents reported that they were affected by the seasonal slack in consumer demand during the quarter.

Construction firms were also pessimistic due to the uncertainty caused by the trade war between the United States and China, as well as red tape and corruption in the government.

For mining and manufacturing companies, they were concerned with the rainy season causing the lack of demand, as well as the lack of government support for mining activities.

Optimism remained for the social services, financial intermediaries, real estate, and transportation sectors.

The Q3 2019 BES was conducted from July to September 2019. There were 1,487 firms surveyed nationwide.

Respondents were drawn from the combined list of the Securities and Exchange Commission’s Top 7,000 Corporations in 2010 and BusinessWorld’s Top 1,000 Corporations in 2017, consisting of 583 companies in Metro Manila and 904 firms in areas outside the capital region. – Rappler.com

 

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.