April 30, 1999
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| April 30, 1999 | atimes.com | |
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| Southeast Asia Malaysian confidence up: Dun and Bradstreet SINGAPORE - A Dun and Bradstreet (D&B) survey has indicated business confidence is riding high in Malaysia as the country swerves onto the path of economic recovery. The latest second quarter survey confirmed that the business community was increasingly optimistic and expected a dramatic turnaround in new orders in the second quarter of the year, said David Emery, D&B vice president and managing director for Asean and India, in an interview. More companies forsee higher sales and profitability, and expect to hire more employees. Of the 380 respondents, the most upbeat were manufacturers, particularly the electronics sector boosted by strong exports to the United States. ''What we're seeing is a solid trend. The businessmen are now clever enough to grasp and understand the power of the ringgit peg. The Malaysian government did exactly the right thing by pegging the ringgit, it really helped to boost competitiveness and business,'' said Emery. The Malaysian government fixed its currency at 3.80 to the U.S. dollar when it announced selective controls last September to insulate the economy from speculators. Emery said the survey indicated there was less fear of retrenchments and with job security, consumers could be persuaded to spend and boost domestic demand. The most positive indicator in the D&B Optimism Index was the sharp rise in the index for new orders to 26 from a mere 2 in the first quarter of the year and -20 in the final quarter of last year. ''That's 46 points between Q4 and Q2. That's rarely seen,'' said Emery. The uptrend is underlined by 43 percent looking forward to more new orders in Q2 than Q1 while 42 percent expect to maintain current levels. The net sales index also improved to 12 against -13 in the first quarter. Some 46 percent are confident of higher sales while 36 expect their selling volume to remain unchanged. The net profit index bounced back to 7 points from -18. Some 41 percent are upbeat that they would make more profits than in the first quarter. The survey had good news for workers, with 14 percent of respondents saying they expect to hire more and significantly and 81 percent saying they do not expect to lay off any worker. Many businesses had lowered their inventories in the past year to increase profitability and ensure cash flow. But in response to the economic pick-up, 30 percent expect to increase inventory level and 44 percent would maintain their positions. For the second quarter, 62 percent expect selling price to remain stable. Another 20 percent foresee prices to go up while 18 percent felt it would continue to fall. Emery said the survey results also showed business was not distracted by the court trial of former Deputy Prime Minister Datuk Seri Anwar Ibrahim. The optimistic sentiment would be buoyed by the recent upgrading of Malaysia by international rating agencies like Standard and Poor's and Moody's, he added. (Asia Pulse/Bernama) | |||||||||
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