More executives in the Philippines optimistic in the first half of 2023 from the second semester of 2022, boosting expectations of higher revenues and profit over the next 12 months.
The Grant Thornton’s International Business Report (IBR), which tracks sentiment among global mid-market business leaders, said optimism climbed to 71 percent, up 6 percentage points from the previous semester.
The optimism is traced on easing inflation and that rising interest rates regime is nearing its end.
Data among 4,857 mid-market executives – including CEOs, managing directors, chairpersons, and other senior executives – from the 28 countries covered, including the Philippines was collected between May and June this year.
The report noted record numbers of mid-market business leaders in the Philippines expecting increases in profitability up 83 percent and revenue from exports up 55 percent.
However, selling prices saw a decline from 63 percent to 61 percent.
The IBR said a record number of leaders expects an increase in exports over the next 12 months — from 43 percent in the second half of 2022 to 55 percent in the first half of 2023.
Those expecting to increase revenue from non-domestic markets was also up 50 percent from 39 percent as well as those expecting to increase the number of countries they sell to — from 41 percent to 53 percent.
Around 66 percent of business leaders expecte to increase investment in staff skills as opposed to 63 percent (down from 65 percent) with intention to invest in technology, an indication that future plans are not all technology-dependent.
The report also showed investment intentions are up for research and development (from 65 percent to 74 percent) and new buildings (from 48 percent to 57 percent) but down in plant and machinery from 62 percent to 55 percent.
Economic uncertainty remains the leading constraint identified by the country’s mid-market business leaders in the IBR, according to 52 percent of respondents.
The number of executives highlighting constraints has fallen across the board though these remain significantly above pre-pandemic averages.
Those identifying energy costs as a constraint fell to 48 percent from 68 percent, significantly higher than the pre-pandemic average of 39 percent). Concerns over availability of skilled workers fell to 48 percent from 52 percent and labor costs fell to 54 percent from 60 percent. Transport infrastructure was down to 45 percent from 50 percent.
Although the impact of regulation and red tape dropped to 45 percent from 60 percent, there are still growing concerns over a shortage of finance which increased to 51 percent from 45 percent.
The H1 2023 IBR research was collected between 16 May — 14 June 2023 and the data sample includes feedback from 4,857 respondents including CEOs, managing directors, chairpersons, and other senior executives from the 28 countries covered in this wave.
Please note, the data is weighted against the latest GDP figures to reflect the size of the countries accordingly.