Friday, 15 May 2009

Survey finds RP consumers more upbeat than most

Don Gil K. Carreon
BusinessWorld
http://www.bworldonline.com/BW051509/content.php?id=059
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FILIPINO CONSUMER confidence fell with rest of the world amid the economic downturn, but the Philippines continues to be among the most upbeat nations due to remittances from migrant workers and the continued outsourcing boom, an Internet poll conducted recently by research firm Nielsen showed.

The biannual Internet poll ran from March 19 to April 2, while the previous survey was from September 22 to October 6.

In a briefing yesterday, Victoria R. Santos, managing director of The Nielsen Media Company (Philippines), Inc., said Filipinos’ sentiment mirrored global uncertainty, as confidence dropped by six points to 96.

The survey, which involved 26,000 respondents in 50 countries, was topped by Indonesia with a score of 104, while South Korea, which narrowly avoided a recession in the first quarter, finished at the bottom with 31.

The Philippines, where 500 people were surveyed, ranked sixth overall and third among the 14 Asia-Pacific economies surveyed.

Only Taiwan posted a higher score at 63 compared to 60 from the previous period, while 48 of the 49 markets experienced a decline.

As a result, the global average went down to 77 from 84.

Nielsen said consumers in Russia (down 29 points), United Arab Emirates and Brazil (lower by 21 points each) suffered the biggest falls in consumer confidence in the last six months as currency devaluation, weakening export markets and falling commodity prices took its toll.

"Global consumers have been battered and bruised by the constant onslaught of bad news in the last six months," said James Russo, The Nielsen Company vice-president for global consumer insights, in a statement.

"Daily announcements of job cuts and company profit warnings, bankruptcies and foreclosures, lowered [growth] expectations and depressed manufacturing forecasts have combined to reduce consumer confidence and spending powers in their lowest levels since the post war year," he added.

Nielsen’s Ms. Santos noted that "although there is decline in consumer confidence, the sentiment of the Filipino consumers ranks among the highest in the world...We are not that low, in fact we rank among the most positive."

"This is possibly aided by sustained remittances from our overseas foreign workers and our continuously vibrant [business process outsourcing] sector. The remittances from the OFW sectors are holding and this is a very critical source of funds for continued spending for our economy," she added.

For his part, Augusto B. Santos, deputy director-general of the National Economic and Development Authority, agreed that sentiment dropped because of the global downturn, but remains relatively strong since the economy would still grow but at a slower pace.

"[The positive sentiment] will boost domestic consumption, which is a major component of the economy," he added.

Nonetheless, Filipinos are now less confident about their job prospects, personal finances on whether it is a good time to spend, the survey showed.

When it comes to spare cash, more Filipinos are considering putting these into savings (69% from 66%), with new clothes (35% from 39%), new gadgets (34% from 35%) and paying off of debts (32% from 37%) the next priorities.

"About seven in 10 Filipinos are saying that if they have spare cash they would rather save it, we are recognizing that there is still uncertainty out there," Nielsen’s Ms. Santos said.

"They remain more prudent when it comes to spending."

The Philippines finished third in the region when it comes to optimism about job prospects.

The survey also showed that the Filipinos who think the country is in recession is now up to almost 80% from the previous survey period, when only 67% respondents felt this way.

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