IN ASEAN COUNTRIES: JAPANESE BUSINESS SENTIMENT DROPS
MANILA, March 4, 2006 (BULLETIN) By MYRNA M. VELASCO - Rising interest rates and inflation coupled with the recent state of emergency in the Philippines have dampened Japanese business sentiment in country.
A survey conducted by the Japanese External Trade Organization (JETRO) showed that the overall current business sentiment for the five ASEAN countries declined 3.1 points over the previous month in February.
Individual indices fell in all surveyed locations — with the exception of Malaysia and the Philippines — as countries struggled with rising interest rates and inflation, as well as weakening domestic demand.
The index for Indonesia recorded the highest drop in the region, slipping a dramatic 21.3 points and reaching its lowest level since the survey began in June 2001, as the country continues to face high interest rates and inflation and in part due to price rises for public utilities.
The overall forward business sentiment for the ASEAN region improved 0.9 points in February, with sentiment picking up in Thailand and Indonesia: The index for Indonesia, however, remained at a low level in this month’s survey.
The overall current business sentiment for China and North Asia fell 2.6 points over the previous month in February, owing to depressed sentiment among Japanese firms in Hong Kong’s non-manufacturing sector.
While overall sentiment among Japanese firms in mainland China has been on a gradual rise since the end of 2005, current sentiment leveled off in February.
Sentiment among companies in the transport equipment sector, however, picked up in this month’s survey, in the wake of buoyant domestic demand.
Although the index for the Republic of Korea (ROK) declined from its record high achieved in last month’s survey, Japanese firms operating in the country posted strong business confidence for the sixth straight month, as the economy remained vibrant in February.
The overall forward business sentiment for China and North Asia improved 3.4 points in February, with the overall index for mainland China gaining 8.7 points.
A total of 729 replies were received in ASEAN countries (115 in Indonesia, 117 in Malaysia, 205 in the Philippines, 207 in Singapore and 85 in Thailand), 253 in China (59 in the North, 86 in the Northeast, 67 in the East and 41 in the South); 147 in Hong Kong; 38 in the ROK and 118 in Taiwan.
Palace urges Filipinos to unite for economic growth March 4, 2006 (From Office of Press Secretary, Malacanang)
Malacañang has called on the Filipino people to unite and support government efforts in further improving the country’s economy by building a firm and strong Team Philippines.
Press Secretary and concurrent Presidential Spokesperson Ignacio R. Bunye said Filipinos must unite and focus on things that would be good for the economy, stressing the need for law and order in achieving economic growth.
"I’m asking the Filipino people to give more attention to things that would improve our lives and the economy. Law and order is essential in achieving economic growth. Let us be a team, a strong Team Philippines in achieving this goal," Bunye said in a radio interview this morning.
Now that the destabilization moves mounted by the critics of President Gloria Macapagal-Arroyo had subsided, Bunye said the Chief Executive can again concentrate on governance and the economy.
He said the Arroyo administration worked hard on strengthening the country’s economic fundamentals, which are the major factors why investors remain confident and bullish on the country as can be gleaned in the strong performance of the peso and the stock market even during the weeklong State of Emergency from Feb. 24 to March 3.
"Temporary situations (coup plots/State of Emergency) did not affect investors’ confidence as they believe that the Chief Executive is in control of the situation," he stressed.
The peso suffered a slight setback on the day the State of Emergency was declared by the President, but bounced back stronger this week, closing at P51.18 against the US dollar, its highest finish since July 30, 2002.
The stock market likewise rallied with investors’ bullishness, ignoring the political noise as they are confident that the situation is only temporary.
The President, in her 10-point pro-poor agenda, has vowed to improve the economy by inviting more investors who will create more jobs for the Filipinos and help improve their lives.
Chief News Editor: Sol Jose Vanzi
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