Similarly, a weighted 14 per cent of factory bosses think business will deteriorate, a sharp fall from the 29 per cent who predicted a slump in January.

Of the 433 manufacturers polled, 96 per cent responded, and individual responses were weighted by their contribution to employment and value added, said the EDB.

A weighted 12 per cent of the 1,500 service firms polled by the DOS from March to April were optimistic, up from 10 per cent in January.

A weighted 25 per cent of firms polled were pessimistic, down from 28 per cent in January.

The greatest pessimists were firms from the real estate industry such as property developers. The information and communications cluster and recreation and healthcare sector were the only two segments where optimists outnumbered pessimists.

But the slight uptick in optimism has good grounds – there is a chance that tourism could give the service sector a lift this year, said Credit Suisse analyst Gerald Wong.

Wong expects tourist arrivals to hit a record high of more than 16 million this year, above the Singapore Tourism Board’s (STB) expectations of between 15.2 million and 15.7 million, and better than the high of 15.6 million reached in 2013.

“We believe the market is underestimating STB’s extensive digital marketing efforts in China, which has kept Singapore a popular destination for Chinese tourists,” he said.

“The strong pick-up in tourist arrivals has been driven by Chinese tourist arrivals, which recovered strongly from mid-2015.”

A tourism rebound is also being bolstered by the rise in Changi Airport passenger volumes, Singapore Airlines passenger volumes and revenue per available hotel room compiled by the STB, Wong said.

Within the manufacturing clusters, precision engineering firms were the most upbeat, with semiconductor equipment and bonding wire firms anticipating higher orders in the next three months.

In its Commodity Market Outlook report issued yesterday, the Washington-based lender said supply disruptions in Iraq and Nigeria hiked oil prices in the first quarter.

Reuters reported yesterday front-month Brent crude futures traded at US$44.75/bbl at 0815 GMT, up 27 cents from their last settlement. US crude futures were also up 27 cents, at US$42.91/bbl.

“In addition, the United States reported that oil production in December fell year-on-year for the first time in several years, and the US Energy Information Administration projections show falling output accelerating in 2016,” the World Bank said.

The bank said a weaker US dollar and improving oil demand also contributed to the rally. That said, the oil market remains oversupplied with stocks near record levels.

Crude oil demand usually slows in late winter and spring due to refinery maintenance, so the bank expects current stocks to remain high, until demand picks up in the second quarter of 2016.

The World Bank expects oil supply to decline further later this year, mostly due to lower output by onshore US producers.

“Slowing output growth from higher-cost, short-cycle, unconventional oil in the US is expected to help rebalance supply. This output includes, but is not limited to, shale plays,” the bank said.

But the bank said it’s still uncertain as to how far production will decline or when it may start rising again.

“The recent oil price rally brought some relief to producers’ cash flow, and many hedged production forward at higher prices, thereby delaying supply rebalancing. Higher prices and continued efficiency improvements could further impinge on required rebalancing,” the bank said.

On the other hand, the industry borrowed heavily during the boom years and spent their cash flow. Many of these companies are encumbered with debt, selling assets, and entering into bankruptcy.

“With external financing increasingly closed, companies will need greater cash flow generation to fund drilling and completion of wells which will depend on the level of prices,” the bank said.

The World Bank said near-term upside risks to the price forecast include dwindling non-OPEC supply and Iran’s slow export growth. There are also risks of supply disruptions among key OPEC producers due to internal conflict and financial constraints.

Higher global demand, particularly from the transport sector, will also help reduce the large global stockpile.

Downside price risks include a slower rebalancing because of weak demand, and continued resilience of US producers to sustain output and develop uncompleted wells. A large increase in Iranian exports and higher production from the rest of OPEC members will sustain the surplus of global stockpiles, and thus continue to put downward pressure on prices.

Meanwhile, the World Bank expects natural gas prices to fall in 2016 on continued weak demand and surplus supply. Gas prices in the US are expected to fall by four per cent and average US$2.5/mmbtu due to high stocks.

However, strong growth in the power sector, rising exports, and slowing production growth are expected to underpin prices. Risks to the forecast are mainly to the downside, given a global supply surplus and forthcoming increases in new LNG capacity.

The Standard Chartered Hong Kong SME Leading Business Index survey for the second quarter of 2016 reported its overall index fell to 40.4, the lowest reading since the first survey result was published in the third quarter of 2012.

The sub-indices of the manufacturing (39.8) and import, export and wholesale industries (34.5) dropped below the level of 40 for the first time, the lowest reading since the survey result was published in nearly four years. The retail industry sub-index also edged down to 42, reflecting the industry’s prevailing bearish outlook.

The other sub-indices for “sales amount”, “investments”, profit margin” and “global economic growth” have slipped to 35.0, 47.7, 33.9 and 23.2, respectively.

“The prevailing pessimism is broad-based as the high degree of external macroeconomic and financial market uncertainty is weighing on local SME sentiment,” said Kelvin Lau Kin-hang, senior economist at Standard Chartered Bank (Hong Kong).

If the sluggish business conditions continue, 19.1 per cent of the respondents may consider winding up within one year, of whom 5.1 per cent feel it could be even within the next three months.

“This means that we need at least one or two more quarters of data before we can confirm that our SME index has bottomed out,” Lau said.

“During economic downturn, companies should make use of technologies to stimulate growth,” said Gordon Lo Siu-chung, director (business management) at Hong Kong Productivity Council (HKPC).

The Standard Chartered Hong Kong SME Leading Business Index survey, conducted by HKPC and sponsored by Standard Chartered Bank (Hong Kong), aims to gauge local SMEs’ outlook on the overall business environment for the next quarter. The survey was conducted from late March to early April this year and drew response from 806 local stakeholders across eight major industries.

Through this generous opportunity provided by the Inquirer, I would like to share the qualities we should look for in our next President, as well as key growth priorities and performance indicators, before the Philippines elects its next CEO on May 9.

First, the country’s new chief executive officer must have a clear vision of how to propel the Philippines forward. He or she must be able to support the vision with concrete strategies and more importantly, see through its implementation. A Japanese proverb says that vision without execution is just hallucination. Thus, sound planning must always translate to decisive action and measurable results.

We have short-term problems that need to be addressed, including our urgent need for efficient infrastructure, the lessening of graft and corruption, and political issues that bring forth geopolitical tensions in the region. Of equal importance is the new CEO’s resolve to push growth priorities that will uplift our people in the long term. And here, I would say that the low lying fruits are in tourism and agriculture.

Tourism is still a largely untapped opportunity and has one of the biggest potentials among our sunrise industries. Supported by adequate infrastructure and support facilities, Philippine tourism can compete head on with destination powerhouses like Thailand and Malaysia. Our country is endowed with beautiful natural spots, hospitable people, and offers a relatively affordable cost of living. We just need enhanced access through airports and road networks. As Tourism Secretary Mon Jimenez said, tourism was the “shortest path to inclusive growth” because it “provides jobs, spurs businesses and connects many other industries.”

Agriculture also remains underdeveloped. The sector contributes only 4 percent to our national GDP (gross domestic product) despite the fact that one-third of our population is working in agriculture. Growing this industry will address the major issues of food security and employment for farmers in rural areas.

Conscious effort

There also needs to be a conscious effort to implement a comprehensive program to make the Philippines a hub for investments. We have the skilled labor force; what we need is consistency in implementing laws and the lessening of bureaucracy.

Ready or not, our country will operate under an integrated Asean, which will allow the free flow of goods, services, investments and skilled labor, as well as the freer movement of capital across the region. This means the Philippines will be looked at not only as a new market by its regional peers, but also as a source of supply for products for a market of 600 million.

Last year, Euromonitor International named the Philippines one of the world’s five emerging markets collectively called NIMPTs, together with Nigeria, Indonesia, Mexico and Turkey. The market research firm considers the Philippines one of the five economic giants of the future for its growing economy, rising income and young, expanding population, thereby offering growth opportunities for consumer goods manufacturers. Hence, it bodes well if our new CEO can position the country as a globally competitive player in trade and investments.

On the real estate front, the collective efforts of major industry players under our organization—the Asia Pacific Real Estate Association-Philippines chapter—have resulted in the creation of a comprehensive outline of growth policy recommendations for the country. We seek to share this with presidential aspirants, since the upcoming 2016 elections provide a unique opportunity for them to leverage more inclusive growth through commitments of launching ambitious, game changing programs.

We in Aprea feel the Philippine property sector’s huge contribution to economic growth and society’s living standards underscores our duty to push for these game-changing reform policies. Real estate impacts 50 other industries, accounts for at least 10 percent of the country’s GDP and directly employs more than 11 million people. We do so by helping design, finance, build, manage and own the assets and critical infrastructure that underpin cities and regions. We are keen on contributing even more.

Turbocharge

While the Philippines has improved its economic development programs in recent years, there is still so much more we can do collectively to turbo-charge national prosperity.

Aprea’s 8 growth priorities propose the following steps:

1) Re-boot Real Estate Investment Trusts (REITs) to turbocharge economic growth through a modernized Philippines REIT framework, to be launched within the first 100 days of the new Congress

2) Establish a long-term urban strategy for the Philippines that incorporates the best thinking of international approaches

3) Connect the Philippines with smart infrastructure by establishing an independent statutory entity that will prioritize and help deliver nationally significant infrastructure

4) Launch a national housing partnership between all spheres of government that enshrines housing supply delivery targets and which de-risks development processes

5) Introduce a green strategy for sustainable and resilient cities by providing incentives to tune up existing buildings and placing the built environment at the center of a national resilient plan

6) Promote the Philippines as a business investment hub by implementing a priority program that will remove barriers to foreign investment, while rejecting actions that raise sovereign risk and adopting competitive neutrality principles

7) Boost tourism numbers and revenues by improving access to tourism destinations through (a) ratifying the Asean Economic Community open skies policy and extending it to other countries; (b) committing to a regional airport priority setting program with a delivery timetable; (c) committing to a second airport for Metro Manila and establishing an independent authority to deliver it by 2030

8) Cut red tape and increase contractual certainty by upgrading the existing Regulatory Impact Assessment process to an international standard, and implementing an e-government online procurement and delivery program driven by performance KPIs that are reported upon annually.

Key growth priorities

Aprea’s key growth priorities above had set a KPI target of seven years, or achieving the following by the end of the next president’s term:

The Philippines moves into the ranks of the Top 5 Asian countries in relation to major indices, such as the Global Competitiveness Index (World Economic Forum), Ease of Doing Business Index (World Bank), and Corruption Perception Index (Transparency International)

Secures a bigger slice of the Asean Economic Community growth cake

Achieves inclusive growth with a measurable social capital dividend and significantly lower inequality

Increases housing affordability and choice for all citizens

Increases annual international tourism arrivals to 7 million

Moves to a more resilient and efficient tax base, including property taxes.

The above are the key priorities and KPIs or key performance indicators that will measure the Philippines’ next CEO as he or she sits in office. And as in a true corporation, he or she will have to face annual stockholders meetings where performance and results will be judged accordingly.

Jose E.B. Antonio is chair and CEO of Century Properties Group Inc., a 30-year-old Philippine real estate firm listed in 2012 in the Philippines Stock Exchange. He is also the chair of the Asia Pacific Real Estate Association (Aprea) Philippines chapter.