Member companies that responded to PamCham’s Annual Business Outlook Survey expressed positive expectations for the year 2019, citing government’s focus on the implementation of the BUILD.BUILD.BUILD program, BSP’s measures to control inflation and political spending for election campaigns as contributors to this year’s promising outlook.
While majority of the respondents declared that generally, performance of their companies was better in 2018 than in 2017, the agribusiness industry however, lamented that 2018 was worse for their sector due to the rise in the prices of raw materials, especially corn and soya, made worse by the increased meat importation meant to control inflation in 2018.
Companies in the food services sector acknowledged that the implementation of the TRAIN Law, the rise in fuel prices and the inflation rate increase going into the later part of 2018 unfavorably affected their net income despite the increase in revenues. The industry remains wary of the effects of TRAIN 2 in 2019 while at the same time acknowledging that election year is always good in terms of revenues for the food industry.
The Real Estate Development and Construction industries assessed 2018 as much much better than 2017 due to the upswing in construction projects. The housing sector pronounced “increased demand for mid-level housing units brought about by the increase in disposable income of salaried employees due to the implementation of Train 1 and the higher peso rate conversion for OFWs”. The housing industry however cautioned that while demand may remain, sales will be dampened by increase in interest rates and high cost of construction will impact profitability.
When asked what factors may have contributed to how their business fared in 2018, companies in the trade sector attributed aggressive marketing as the reason for the growth in their sales but was somehow offset by high operation costs and too many holidays last year.