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Saturday, September 24, 2005
Japanese firms find RP, Asean depressing
Overall business sentiment of Japanese companies and their affiliates operating in the Philippines and in 11 other countries in Asia have declined amid rising prices of crude oil and raw materials.
The Japan External Trade Organization (Jetro) reported that business sentiments of Japanese companies in 12 countries in the Association of Southeast Asian Nations (Asean) and North Asia, including China, have decreased since May this year.
This, as Japanese companies have been worrying about future business prospects in their operating region, according to a Jetro statement furnished to Sun.Star.
Brief spell
Jetro recorded a brief spell in positive territory in July, but the index for Asean returned to the negative in August.
“Japanese business sentiment in the Asean and North Asia regions has been depressed since earlier this year, specifically in Malaysia, Philippines, Singapore and Taiwan,” the Jetro report said. “Even in Indonesia and Thailand, where favorable sentiment has been recorded in recent months, business sentiment in August reveals that firms there are starting to worry about future business prospects in their operating region.”
Slipping
Jetro polls the companies to measure year-on-year changes, expressed as diffusion indices, in their business outlooks for the current month and the next two to three months going forward.
Overall current business sentiment for the five Asean countries included in the survey fell by 2.6 points in August, with the index slipping into negative territory for the third time this year.
Current sentiment declined last month in Indonesia, Philippines and Thailand. Indices remained in negative territory in Malaysia, Singapore and the Philippines for August, July and April, respectively.
“Looking at the figures by region, we see that the condition of business sentiment has remained severe in Singapore, Malaysia, the Philippines and Taiwan since the beginning of 2005,” Jetro said in its report.
Over the past several months, though, Japanese business sentiment has been favorable in Indonesia and Thailand, led by booming auto industries in both countries. However, the index for Thailand slipped into single-digits for the first time in 20 months, falling by 12.9 points in August, while the index for Indonesia fell by 4.7 points.
Improved
Forward business sentiment improved in Malaysia and the Philippines, while declining in Indonesia, Singapore and Thailand; indices for Singapore and Malaysia remained in negative territory, while the index for Thailand fell into negative territory for the first time since March 2002.
Overall current business sentiment declined 1.4 points over the previous month in China and North Asia, with sentiments slipping in all locations (with the exception of East China and Hong Kong).
Dipping
The index for Taiwan remained in negative territory for the sixth straight month, while the index for East China returned to positive territory in August, after dipping into negative territory for the first time in this survey’s history in July.
Forward business sentiment declined again in East China and Hong Kong, while improving in all other locations.
The index for Taiwan remained in negative territory in the August survey.
Survey results suggested that the July 21st revaluation of the Chinese Yuan, which was by two percent, had little or no impact, to date, on Japanese businesses operating in China, Jetro said.
Jetro, in cooperation with Japan’s Ministry of Economy, Trade and Industry, has been conducting the survey in the first week of every month since June 2001 in the five major Asean countries. South China, Hong Kong and Taiwan were included since June 2002.
The Republic of Korea and Northeast China were included since October 2002.
A total of 755 replies were received in Asean countries, of which 188 are from the Philippines.
The survey aims to provide up-to-date information on business conditions in the Asian economy to help companies develop more effective business strategies. Firms are asked to compare earnings prospects, supply and demand, inventory, sales prices and accounts receivable with the same period one year earlier. (JBN/with PR)
(September 24, 2005 issue)
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