Bosses upbeat about next six months: Survey

The Business Times-Singapore University of Social Sciences Business Climate Survey polled 176 firms in December and last month. It found that sales and new orders improved markedly while profits contracted the least since the first quarter of 2015.
The Business Times-Singapore University of Social Sciences Business Climate Survey polled 176 firms in December and last month. It found that sales and new orders improved markedly while profits contracted the least since the first quarter of 2015.ST PHOTO: ALVIN HO

Optimism made a welcome return to the business community late last year on the back of better conditions, according to a new survey.

It found that sales and new orders improved markedly while profits contracted the least since the first quarter of 2015.

Bosses were optimistic about the next six months - the first time this has been recorded since the second quarter of 2014.

All groups of firms - foreign, local, large, and small - saw improved sales in the fourth quarter compared with the previous quarter and the same period a year earlier.

The poll consultants said the improvement of sales and new orders to "very low contraction levels" implies that there is likely to be expansion in this quarter.

The widespread improvements in performance caused a large rise in optimism among firms, according to The Business Times-Singapore University of Social Sciences Business Climate Survey.

It polled 176 firms in December and last month.

Bank of America Merrill Lynch economist Mohamed Faiz Nagutha said: "The turnaround in business sentiment is not surprising. The regional and domestic macro situation has improved dramatically from a year ago, with above-trend real GDP growth in Singapore expected to continue into 2018-19 by our forecasts."

Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye agreed with the optimistic outlook, given the global growth recovery, but said: "Singapore is handicapped, however, by manpower constraints and may not be able to capitalise on the upswing in external demand."

Instead, business prospects are probably brighter in the immediate neighbourhood, including Thailand, Indonesia and Malaysia, they added.

The fourth-quarter improvements were due to both overseas and domestic activities. Firms saw better performance in both areas, but with overseas business outperforming domestic business across the board.

A version of this article appeared in the print edition of The Straits Times on February 13, 2018, with the headline 'Bosses upbeat about next six months: Survey'. Print Edition | Subscribe