Magazines Archives - 2009 January

Philippine retailers play game of conservative optimism
Story 5 - Focus

Philippine retailers are more optimistic about 2009 than their counterparts in the region, but this
does not mean they are not taking precautions at a time when a recession of yet unknown
proportions is taking its toll on the world. Tina Arceo-Dumlao reports.

Retail companies around the world would like nothing more than to erase the last few months
of 2008 from their memory. Who Rcould blame them? The global financial crisis has forced consumers to keep their cash firmly in their wallets for fear of losing their jobs or homes like many in the US financial and automotive sectors.

In the Philippines, which underwent the Asian currency crisis that had caused a major upheaval in the financial and credit markets in the region a decade ago, banks are now stronger and the
economy is expected to grow by at least 3.5% next year, even amid the global economic downturn.

Admittedly, its economic expansion will be slower than initially expected — but a growth nonetheless. So, while retail companies here have turned more cautious, they remain optimistic about riding on that growth, forecast to be much higher than what is expected in the more developed countries in North
America and Europe.

Frances Yu, assistant vice-president for marketing at Rustan’s Supercenters Inc, says the retail industry is likely to go through a “moderate” slowdown next year, although not to the extent
experienced by US retailers, some of which like electronics retailer Circuit City have already filed for bankruptcy protection.

According to government data, the second quarter of 2008 saw Philippine retailing grow at only 4.3% year on year, far below 2007’s 8.2%, while personalconsumption expenditure rose by only 3.4%, with hope for better growth in the last quarter of the year being placed on the Christmas shopping period.

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