Philippine companies more upbeat for Q2, rest of 2023

MANILA  -Companies are expecting even better prospects in the second quarter of 2023 as well as the next nine months as they see the benefits of a fully reopened economy ripening, the latest quarterly Business Expectations Survey (BES) of the Bangko Sentral ng Pilipinas (BSP) shows.

The BES covered 1,554 firms—including 582 that are based in Metro Manila—drawn at random from the list of Top 7,000 Corporations ranked based on total assets in 2016-2017 from the Bureau van Dijk database.

The survey was conducted from Jan. 13 to March 6, and three out of five gave answers.

Findings show higher business confidence index numbers regarding the second quarter at 49 percent from 31.3 percent in the previous survey done three months earlier.

The confidence index is computed as the percentage of respondents that answered in the affirmative less the percentage of households that answered in the negative, with respect to their views on a given indicator.

The BSP said the improved confidence on the next quarter was based on expectations of higher volume of sales, especially in the businesses of food and beverages, electronic parts, computers and laptops, paint, garments, airline tickets and loan products.

Respondents were also expecting improved business activities and operations, and a seasonal uptick in demand over the summer months.

These are all thanks to the full reopening of the economy due to the easing of pandemic restrictions, the BSP said in a report on the survey results.

Also, the overall business outlook on the next 12 months was better at 61.9 percent compared to the 46.2-percent readout from the fourth-quarter 2022 survey.

This, in turn, was based on respondents’ expectations of higher demand and sales, a continuously fully reopened economy, better business conditions, and new business opportunities.

In terms of the employment outlook for the April-June quarter, this index eased to 13.4 percent compared to 21.2 percent in the previous survey.

“The lower reading suggests that hiring intentions may turn less favorable for the next quarter,” the BSP said.

However, firms became more upbeat with their hiring activities over the next 12 months, with the index rising to 36.4 percent from 29 percent.

For companies in the industry sector, the percentage of those with expansion plans decreased 19.1 percent from 19.5 percent.

“In particular, the increase in the percentage of firms with expansion plans belonging to the mining and quarrying subsector was counterbalanced by the decline in the percentage of firms with expansion plans in the manufacturing, electricity, gas and water and agriculture, fishery and forestry subsectors,” the BSP said.

For the next 12 months, the ratio of industry firms with expansion plans improved to 26 percent from 22.9 percent.

The BSP said this was driven by the increase in the percentage of firms with expansion plans from the mining and quarrying, manufacturing and the agriculture, fishery and forestry subsectors.

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