Aquino, PHL delegation leave for World Economic Forum in Switzerland

Published January 23, 2013 11:16pm

President Benigno Aquino III on Wednesday night led a Philippine delegation to Switzerland, where they will attend the World Economic Forum (WEF) in Davos.

Aquino and the delegation boarded a flight for Davos at the Ninoy Aquino International Airport Terminal 2 at about 11 p.m., radio dzBB's Rodil Vega reported.

The report said Aquino, in his departure speech, said he would tell about the experience of the Philippines in fighting corruption under his watch.

Executive Secretary Paquito Ochoa Jr. said the government set aside some P49 million for the trip.

A Palace statement also said a 63-member delegation will accompany Aquino.

Last weekend, deputy presidential spokesperson Abigail Valte also said Aquino will meet and discuss issues with global business leaders, and make a pitch for the Philippines as “under new management and we are open for business.”

She said Aquino will also meet with the Filipino community in Zurich on Jan. 26 before returning to Manila.

Valte said Aquino’s delegation will have Cabinet members, including:

Foreign Affairs Secretary Albert del Rosario
Finance Secretary Cesar Purisima
Budget Secretary Florencio Abad
Trade Secretary Gregory Domingo
National Economic and Development Authority head Arsenio Balisacan
Cabinet Secretary Rene Almendras
Presidential Communications Development and Strategic Planning Office head Ramon Carandang

Valte said Aquino will also meet with the Filipino community in Zurich on Jan. 26 before returning to Manila. Davos concerns

Business leaders in Davos have plenty to worry about, from the euro zone to global geopolitical upheavals, but at heart their problem is simple: how to find new revenue in a low-growth world.

Half a decade on from the financial crisis, investors want to see earnings driven by more than just cost cutting. Their focus now is on a return to sales growth, which presents the world's largest corporations with a $5 trillion challenge.

That is the amount of extra revenue the 1,200 top global companies need to find each year simply to meet analysts' expectations, according to consulting firm Accenture.

"The trouble is that stock markets' expectations of the ability of companies to grow far exceeds the underlying macroeconomic growth rates," said Mark Spelman, Accenture's global head of strategy.

"So companies need to get beyond just thinking about emerging markets and rising middle classes and start to look at those segments where you are seeing significant consumer change, because there is a lot of latent growth in those segments."

Increasingly, companies are seeking specific pockets of opportunity for sales growth. They remain cautious about major new investments, however, with confidence among managers in the near-term outlook for their businesses still weak.

Falling business confidence

The annual PricewaterhouseCoopers survey of 1,330 chief executives found only 36 percent were "very confident" of their firm's prospects for revenue growth in the next 12 months, down from 40 percent a year ago. It is the second consecutive year of falling confidence.

Latin America was the only region to buck the global trend, according to the report published on Tuesday as 2,500 delegates, including 1,600 business leaders, gathered in the Swiss Alps for the annual World Economic Forum.

Unsurprisingly, European CEOs were the most pessimistic, with just 22 percent very confident of growth, down from 27 percent last year. Confidence in North America also fell to 33 percent from 42 percent, while Asia slipped to 36 percent from 42 percent.

Even business leaders in Africa - now widely touted as the next high-growth region - were less upbeat than a year ago.

"CEOs see a global economy that is reluctant to recover and that clearly impacts how they think about their own companies' prospects," said Dennis Nally, chairman of PricewaterhouseCoopers International.

"They are running their businesses cautiously, not really prepared to make any significant investments or additions to headcounts until they can get some more clarity."

Companies have responded to tough times by managing operations more tightly. That means cost cutting remains a priority and ambitious investment projects, including big acquisitions, are off the agenda for now.

Continuing uncertainty over economic growth tops the list of CEO concerns, with the problems caused by governments running unsustainable fiscal deficits ranking second. Other issues also keeping company managers awake at night include concerns about excessive regulation and the instability of capital markets.

The prevailing business mood paints a bleak picture for job prospects, with only 45 percent of CEOs planning to recruit in 2013 - down from 51 percent in 2012 - while 23 percent intend to reduce the size of their workforce. Macro vs. micro mismatch

The mismatch between the sputtering global market for goods and services predicted by macroeconomists and the lofty numbers forecast by analysts following individual companies is striking.

In all regions, analysts' forecasts for company revenue growth are well above prevailing views on underlying economies.

While the World Bank last week cut its 2013 global growth forecast to 2.4 percent - and just 1.3 percent in advanced economies - analysts see company revenues expanding by 7.8 percent in Asia outside Japan, 3.8 percent in the United States and 2.4 in the euro zone, according Thomson Reuters data. — ELR, GMA News

Tags: worldeconomicforum, davos, switzerland