More German firms losing faith in PH growth story?
Fewer companies belonging to the German business chamber think the economy would get better in the next 12 months, a summary of an annual survey showed, stressing the “need” for a business-friendly climate.
This was according to a statement from the German-Philippine Chamber of Commerce and Industry (GPCCI), which cited the results of the yet-to-be-released 2019 AHK World Business Outlook Survey. The full survey has not been released to the media.
Out of 130 Filipino and German member firms surveyed last month, only half said they expected better economic development in the next 12 months.
“Although the figures [remain] high, the results on the expectations in the areas of business development, investment intentions and general economic development show a downtrend from last year by 8 percent, 6 percent and 8 percent respectively,” the chamber said.
The latest figure marked a growing lack of optimism in the Duterte administration.
In 2016, 71 percent of respondents expressed optimism. This dropped to 65 percent in 2017, and then 58 percent in 2018.
Of the remaining 65 respondents in the 2019 survey, the firms either responded economic development would be the “same/consistent” or “worse.”
The “underlying issues” cited by the respondents included: impending changes in the country’s corporate income tax, the fiscal incentive scheme and the progress in the security of tenure bill.
“The GPCCI survey clearly shows that the pending reforms have to be finalized by the government. They need to create a business- and investor-friendly environment,” said GPCCI president Tristan Arwen “Bobbit” Loveres.
The chamber’s statement also revealed a decrease in the number of firms willing to further invest. Last year, 55 percent of the respondents expressed such intention. That figure has dropped to 49 percent.
Interestingly, despite the growing lack of optimism among the respondents, 71 percent said their respective companies were in a “better” business situation, higher than last year’s 65 percent and the year before’s 56 percent.
