Business sentiments improved both in the first and second quarters this year despite the two-week enhanced community quarantine (ECQ) in National Capital Region Plus until April 11.
Confidence index in the Bangko Sentral ng Pilipinas’ (BSP) Business Expectation Survey (BES) for the first quarter of 2021 rose to 17.4 percent from quarter-ago’s 10.6 percent while the second quarter jumped to 42.9 percent from 37.4 percent.
In a virtual briefing Thursday, BSP Department of Economic Statistics (DES) Senior Director Redentor Paolo Alegre Jr. cited the positive development in businesses sentiments, saying optimism of businesses in the first quarter of the year “is usually off” and “that’s about 35 percent of the time.”
He said respondents attributed their enthusiasm to easing of quarantine restrictions and reopening of businesses, observations that people are adapting to the new normal, hikes in the volume of sales and orders, coronavirus disease 2019 (Covid-19) vaccine rollout, and development of new business and marketing strategies.
Alegre said optimism for the next quarter and next 12 months is also on the rise due mainly for the reasons cited for the first quarter.
“In relation to our analysis, the current quarter BES result is a good coincidental indicator for the first quarter GDP (gross domestic product) result,” he said, adding the correlation is around 0.5 percent.
He said it is still hard to determine the impact of the two-week enhanced community quarantine (ECQ) in the NCR Plus, which covers the National Capital Region, Laguna, Cavite, Bulacan, and Rizal, but added “the lockdown may have an impact on business sentiment.”
However, Alegre said “respondents are adapting or developing strategies to adapt to the new normal.”
Meanwhile, BSP Monetary Policy Sub-Sector Senior Assistant Governor Illuminda Sicat said despite the ECQ, “there are lots of positive developments around us” such as the vaccine rollout, vaccination of medical front-liners, and positive outlook on both the global and domestic economy.
“In addition, there are already economies opening up and these would provide opportunities to some of our OFWs (overseas Filipino workers) displaced in the early part of 2020. So there are many things that could affect the sentiments. The lockdown is not the only factor,” she said.
Deputy Governor Francisco Dakila Jr. said the situation now is different compared to the start of the pandemic last year since there were more uncertainties last year.
“The trend really is (a) general recovery of optimism in the prospects of the economy,” he said, but added the need to wait for the results of the third quarter BES.