MANILA, Philippines – A Thomson Reuters/INSEAD survey showed that Philippine companies’ optimism for the country’s economy has slightly diminished and business sentiment is now less bullish than it was in the third quarter of this year.
The report indicates that Philippine business sentiment dipped from 100 to 83, with eight of 12 respondents showing a positive outlook.
However, the overall outlook still remained on the positive side, with five of the twelve respondents reporting a rise in employment levels; and eleven of 12 companies reporting increases in new order and sales levels.
In general, a reading of above 50 is indicative of a positive outlook.
The survey also indicated a decline in business sentiment in other Asian countries also declined, with the overall Asia Business Sentiment Index falling to 66 in the third quarter from 74 in the previous quarter, marking its most significant decline in three years.
In an interview with Reuters, Frederic Neumann, co-head of HSBC Asian economic research, said that “while growth is still robust across Asia, businesses are grappling with a number of challenges, including worries about rising interest rates as the Fed begins to press the brakes.”
In the Philippines, 2014 has been marked by a generally positive economic climate:
• GDP grew by 6.4 percent in the second quarter of 2014, compared with a growth of 5.6 percent in the first quarter of 2014. This rate is slower, however, than the 7.9 percent in the second quarter of 2013
• Unemployment rate in July 2014 remained pretty much unchanged, indicationg a 0.6-percentage point decline to 6.7 percent from 7.3 percent in July 2013
• Underemployment was reduced to 18.3 percent in July 2014, from 19.2 percent in the July 2013