Businessmen expect job cuts, recession next year

MANILA, Philippines - An overwhelming majority of Filipino business leaders expect the economy to contract next year, according to a poll conducted by the Makati Business Club (MBC). Besides a recession, senior business executives see a tight credit environment for 2009, severely constraining industry attempts to expand their operations, 87 percent of MBC members surveyed said. This category covers executives who “somewhat agree (70.1 percent)" and “completely agree (15.9 percent)" that a recession will be in the offing next year, according to an MBC survey undertaken from October 24 to November 7. Moreover, approximately 76 percent of MBC members surveyed said “obtaining bank loans for [their respective companies] will be more difficult" while 75 percent said that “access to trade credits will be more difficult." Owing to these bleak expectations, 62 percent of respondents said that their “company’s workforce will contract" in the coming year. An estimated 55 percent see capital spending to fall in the same period, even though 35 percent intend to hike new investments within the next six months. More than three fourths of businessmen surveyed also said that the peso-dollar rate will decline, making exports cheaper but imports—including raw materials used for goods sold abroad—more expensive. For his part, MBC executive director Alberto Lim said that the Philippines’ economic growth will experience a “mild downturn" in the first three months of next year. However, the same survey also indicated that businessmen see slowing inflation for 2009. Besides being the Philippines’ premier business organization, the MBC is composed of more than 800 executives of the country’s largest local and foreign companies. - GMANews.TV