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MANILA – A steady increase in the number of German firms here, saying they are in a “better situation” is seen in the latest Fall 2022 AHK World Business Outlook (WBO) Survey of the German-Philippine Chamber of Commerce and Industry (GPCCI).
The Fall 2022 survey held last month with 68 respondents involved in German-Philippine business relations showed that 53 of the companies considered that their businesses are in a better situation.
This is higher than the 47 percent in the Spring 2022, 32 percent in the Fall 2021 and 19 percent in the Fall 2020 surveys.
The number of companies saying their businesses are in worse situation continued to decline from a high of 36 percent in the Fall 2020 survey to only 6 percent in the latest poll.
“We are glad to see that companies still experience a better business situation in the Philippines despite growing global economic impediments,” GPCCI Executive Director Christopher Zimmer said.
There are more optimistic enterprises related to German-Philippine businesses, with 61 percent of respondents saying they expect better business development in the next 12 months.
However, it was also noted that the number of companies with pessimistic outlook in the next 12 months increased by 12 percentage points from 1 percent in the Spring 2022 poll to 13 percent in the latest survey.
This number is the second highest since the Fall 2020 survey, with 18 percent of the respondents saying they expect a worse business outlook for the next 12 months.
The GPCCI said the number reflected the sentiments of companies that have started to feel the impacts of the global energy crisis since the Russian-Ukraine war early this year.
German-Philippine businesses also said the top risks to business development in the next 12 months include disruptions in supply chain, higher energy prices, and the exchange rate.
With the economic headwinds that firms are facing, lesser companies expect better local economic development in the next 12 months, from 41 percent in the previous survey down to 34 percent in the Fall 2022 survey.
More firms projected that the domestic economy would be worse in the next 12 months as the number of respondents increased to 27 percent in the Fall 2022 survey from only 8 percent in the Spring 2022 poll.
With the pessimistic outlook in the local economy, companies that said they will pour in more investments in the next 12 months declined to 35 percent from 44 percent.
“With the increasing global impacts of energy crises and supply chain disruptions, (the) German business community now consider looking for new suppliers and relocating their production to boost operations,” GPCCI president Stefan Schmitz said.
Schimtz urged the Marcos administration to utilize the policy reforms in attracting more foreign direct investment inflows in the coming years. (PNA)