Business confidence of German companies operating in the Philippines has waned under the weight of an overwhelming health crisis, as more than half of companies surveyed said they might invest less, or worse, not at all, in the next few months.
The German-Philippine Chamber of Commerce and Industry (GPCCI) said 56 percent of member firms surveyed had said they would either invest less or not at all within the next 12 months, the group said in a statement on Tuesday. This was according to the results on the Philippines of a global survey conducted among member firms of German business chambers. The survey, called AHK World Business Outlook, covered more than 3,700 German companies worldwide.
Forty-five GPCCI member firms participated in the survey, of which 58 percent came from the services sector, 24 percent from the trade sector and 18 percent from industry and construction sector, GPCCI said in the statement.
When asked about business prospects, 40 percent expect their situation to get worse in the next 12 months, 42 percent forecast an even poorer situation in the midterm.
“Judging from the results, we see that COVID-19 has led to an erosion of business confidence,” said Martin Henkelmann, GPCCI executive director.
The numbers show a weaker business confidence when compared to last year. Seventy-one percent survey respondents last year said they were in a good situation, while only 20 percent said the same this year. Last year, 63 percent projected a better business environment within 12 months, now only 20 percent had that kind of optimism.
“This is understandable as the worldwide fight against the virus has caused the government to impose lockdowns, which affected business activities and disrupted the flow of goods,” Henkelmann said.
Moreover, 25 percent of survey respondents said the pandemic had caused sales decline of 10 to 25 percent, while 24 percent of said their sales decline had reached 25 to 50 percent. INQ