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Wednesday, December 21, 2005
Japanese firms in Asean ‘slightly’ optimistic
The business sentiment of Japanese companies and affiliates operating the Asean region improved slightly in November, according to a survey by the Japan External Trade Organization (Jetro).
But the overall business sentiment of Japanese firms operating in China and North Asia has declined slightly, Jetro said in a statement.
Negative
Forward business sentiment declined in almost every surveyed location in China and North Asia, with the region’s overall index dipping into negative territory in this month’s survey, it said.
Jetro conducts a survey on Japanese companies operating in the Association of Southeast Asian Nations (Asean) region and other parts of Asia 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.
Overall current business sentiment for the five Asean countries included in the survey was up 1.2 points in November.
Current sentiment improved over the previous month in Malaysia, the Philippines and Singapore, while declining in Indonesia and Thailand.
Rising prices
Concern over rising prices and interest rates were to blame for an 8.4-point drop in Indonesia’s current business sentiment; the country’s index fell into negative territory for the first time in two years in November.
Indices for Malaysia and the Philippines remained in the negative territory for the eleventh and seventh straight months respectively. But indices for both countries, although still in negative, were up slightly in November.
Decline
Forward business sentiment declined somewhat in all surveyed locations in Asean, with the region’s overall index dropping 6.4 points in November.
The index for Indonesia—where concern among firms over cooling consumer spending and rising prices and interest rates continued—was down the sharpest, slipping 18.5 points.
Overall current business sentiment declined 2.8 points over the previous month in China and North Asia.
Improvements were seen in North and East China, while significant declines were recorded in Northeast and South China, where indices fell 16.8 points and 19.8 points respectively. Indices for both regions dipped into negative territory in November.
Although recording a small decline in this month’s survey, the index for the Republic of Korea remained strong (now at over 20), on the back of a buoyant domestic economy.
Forward sentiment
Overall forward business sentiment was down again in China and North Asia, with the region’s index dropping 5.0 points to negative 1.1 in November.
With the exception of South China—whose index returned to positive territory in November—forward sentiment declined in all surveyed locations in the region.
A total of 770 replies were received in Asean countries, 197 of which are in the Philippines.
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.
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. (LAP/with PR)
(December 21, 2005 issue)
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