Singapore companies remain optimistic about economy in spite of global financial turmoil and economic uncertainties

Singapore companies remain optimistic about economy in spite of global financial turmoil and economic uncertainties

Singapore, 7 January 2008 - According to survey findings by Grant Thornton International Business Report (IBR), Singapore is ranked fourth most optimistic in the world, with an optimistic balance* of +84 per cent. Topping the chart are Philippines and India, showing an optimism balance of +95 percent, followed by Vietnam (+87 per cent). Optimism from this group is dramatically higher than the global average (+42 per cent) and East Asia average (+40 per cent). Their optimism can be attributed to the robust economic growth of recent years and widespread expectations that the momentum will be sustained during 2008.

When asked about specific business practices, Singaporean survey respondents were positive about the future. For instance, a balance of +71 per cent of businesses in Singapore are optimistic about turnover in 2008, despite the figure being slightly lower than that found in the previous year. Businesses in Singapore were also more optimistic about selling prices, exports and investments in new buildings, plant and machinery.

Aw Eng Hai, a partner with Foo Kon Tan Grant Thornton, the Singapore member firm of Grant Thornton International commented: “Although we have entered a period of greater uncertainty, amidst concern over fallout from the US sub-prime mortgage crisis and the increased business costs, it is encouraging to know that businesses in Singapore remain confident in the country’s economy”.

The annual survey of privately held businesses shows that despite intense media coverage of the global financial crisis, +42 per cent of global businesses report feeling optimistic about the economic outlook for the next 12 months. This is only three percentage points lower than that reported in January 2007.

 

 

Although global optimism has fell overall, developing East Asian countries generally continues to experience healthy expansion in contrast to the EU and US. Since 2003, optimism levels in Singapore have improved dramatically. Japan however, reported a slump in its pessimism levels from last year’s balance of -5% to -44%, making it the least optimistic out of 34 countries covered in the global survey of business expectations.