Business outlook up
due to May elections

The coming May Presidential elections may bring uncertainty, but at least they bring “the fresh wind of change.”

A survey conducted by the Makati Business Club among its members showed businessmen at their most optimistic in the last 14 years. Eightynine percent of respondents said they expect this year’s economic growth to surpass the growth in 2009. In contrast, only two percent of respondents felt the same way when the same survey was conducted in March last year.

The MBC’s Executive Outlook Survey, conducted in March this year, had 74 respondents representing ten percent of the MBC’s membership.

MBC executive director Alberto Lim noted that part of the optimism could be because the country is already coming from an 11-year low of 0.9 percent gross domestic product growth, “when the economy barely managed to avoid a recession.” In addition, Lim said there was also anticipation that the coming elections “could bring a fresh wind of change” to the country.

Lim says the last time MBC respondents expected economic growth to be higher than that of the previous year was in 1996.

On the other hand, 66 percent of the businessmen-respondents feel that inflation would be higher this year than last year, possibly because of the inflationary effect of massive election spending. In contrast, only 11 percent expected higher inflation last year.

Two-thirds of the respondents, or 66 percent think that investments will be higher this year compared to last year, as against only six percent who felt the same way in 2009.

For the dollar exchange rate, more than 36 percent or a little more than a third of respondents believe that the peso-dollar exchange rate will be roughly the same as the end of the previous year’s exchange rate. A third, or 33 percent of respondents believe that the peso will be appreciating, while just a little less than a third, or 29 percent believe the peso will depreciate by yearend.