Filipino bizmen upbeat despite Corona trial

MANILA, Philippines – A survey showing continuing optimism among Filipino businessmen highlights how the tension between the Aquino government and the judiciary failed to dampen the sentiments about their future, a Palace official said.

The Philippines has the 4th biggest community of optimistic business leaders in the world, according to the 4th quarter report of the Grant Thornton International Business Report released Tuesday, April 10.

Amid the ongoing impeachment trial against Chief Justice Renato Corona, the survey showed that 82% of Filipino respondents are upbeat about the next 12 months.  

“That’s good because the initial concern of the political commentators was that [the impeachment trial is] going to affect the business climate…I think the business leaders and the business community get it — what the Philippine government is doing and what we have committed to do,” Presidential Spokesperson Edwin Lacierda said in a press briefing on April 10.

“We are going to level the playing field. We are going to also enhance the facilitation of registration that means cutting the bureaucratic red tape and we have done so and we will continue to improve our services. It’s something that we intend to achieve to make sure that there is clearly a level playing field for the business community,” he added.

One of the questions in the survey was: “Does the tension between the executive and the judiciary branches of the government have an impact on your business?”    

Seventy eight percent (78%) replied “No.” Only 20% acknowledged it is affecting their business, while 2% are unsure.

Optimistic countries

In previous surveys, Philippines ranked in the top 5 most optimistic countries, taking the 2nd and 3rd top spot in 2005 and 2007.

This 2012 survey results, however, showed that more Filipino businessmen are upbeat. This year’s 82% was higher than the 50% and 71% seven and 5 years ago.

The survey, which  Grant Thornton International Business Report (IBR) optimism league table,

The Philippines ranked behind Peru, Brazil, the United Arab Emirates, and Georgia, according to the survey results, which was released by audit, tax and advisory firm Punongbayan & Araullo (P&A), Grant Thornton’s local member firm.

“The Philippines has done a good job of staying resilient despite the economic volatility around the world,” says P&A Managing Partner and CEO Marivic Españo.

“Now that the global mood has also picked up, particularly among more mature economies, and the government seems determined to make up for its underspending last year, I think we’re on track to maintaining this upbeat outlook.”

Survey highlights

Beneath the general rosy outlook of the respondents, expectations to specific economic indicators showed otherwise.

Asked about their revenue prospects, 48% respondents said they expect an improvement, down 12 percentage points from last quarter.

Respondents’ ability to hike prices suffered the biggest drop. Of the Filipino business leaders in the survey, 14% expected to increase their selling prices. In the previous quarter, 46% respondents did.

Regulations/red tape, which in the past had consistently emerged as the top obstacle for Filipino business leaders, has become less of a hindrance this quarter: 22% of local respondents reported it as a business constraint, compared to 32% last quarter.

“Bureaucracy has long been a cause for concern for businesses in the Philippines. So while it’s good to note that fewer respondents are hampered by it, it bears to mention that it still emerged as the top constraint, along with information and telecommunications infrastructure,”  Españo stressed.
    
“Perhaps some business leaders are starting to feel the effects of the government’s drive to improve the ease of doing business in the country. The Department of Trade and Industry’s Philippine Business Registration workstation is a good start. But we’ll see what other concerned government agencies will contribute to this effort,” she added.

The IBR, which began as an annual survey of business sentiment, started doing quarterly polls of economic confidence during the last quarter of 2010. Since then, confidence in the Philippines has been fluctuating, but has consistently outpaced optimism globally and in the ASEAN region.

IBR is a survey of both listed and privately held businesses. The data for this release are drawn from interviews with 3,000 businesses globally conducted in January and February 2012. Respondents were chief executive officers, managing directors, chairmen or other senior executives from 40 economies. – Rappler.com