Business leaders hope for better 2021, but risks loom

·5 min read

THE new Covid-19 strain has dampened the positive 2021 outlook of the business community that was gearing up for its road to recovery.

As business leaders looked forward to the vaccination of the population, the new virus variant meant that enterprises would again brace for another year full of evolving policies and uncertainties.

“While the emergence of the vaccine against Covid-19 provides at least a psychic relief for all, worrying mutation of the viral disease is a damper. Against this constant threat late into the year, it would be best to remain vigilant and conservative,” Cebu Chamber of Commerce and Industry president Felix Taguiam told SunStar Cebu.

Taguiam said the economy cannot withstand another round of what it had undergone in 2020.

“The market has not picked up yet, and consumer confidence remains understandably low. There is a need to balance this and stimulate business activity for the good of all. Hence, while the gainers among us continue with infusing their investments into the local economy, the strugglers and challenged industries will need both policy and enabling measures to get back better on their feet — especially for the micro and small businesses that make up the larger number in the business community,” he said.

Taguiam said the chamber would like to appeal to all stakeholders in Cebu to join them in facilitating the ease and lowering of the cost of doing business.

“Our shared goal is to make Cebu competitive. We have started with the issue of high cost of power, and we expect to see results early enough in 2021 to ease the pain among consumers in Cebu. We will also pursue all hurdles to our shared goal; otherwise, Cebu business will lose its vibrancy and edge,” he said.

Mandaue Chamber of Commerce and Industry president Steve Yu remained positive for the next year.

“The year 2021 is the year we wake up from a nightmare. It will be better than 2020 because it will be a recovery year. We will attain at least six percent growth in 2021, still below the pre-pandemic level of 2019, but it’s a big consolation that life is getting better especially towards 2022,” he said.

Yu said people still have to wear masks and will retain much of the basic health and safety protocols in 2020. Most students will still study from home, and some adults will slowly go back to working in the office.

“The digital transformation will continue to accelerate. There will be more profound changes in our business lifestyle as internet speed continues to improve with 5G technology,” he said.

New norms will continue

Yu said there will be new norms of doing business.

“Entirely new industries will rise while some traditional businesses will close,” he said.

Yu also pointed out that self-sufficiency and buying local will continue to be advocated by the government.

There will also be more investments in health facilities like hospitals, equipment etc. and private and public sector collaboration will continue to move forward.

Among the industries that will continue to register strong growth in 2021 are internet and e-commerce, healthcare-related facilities, healthcare and hygiene products, household products, skin care products and computer hardware.

Those likely to register moderate growth are power and energy, garments and fashion, fuel and oil, nutritional products, food and non-food retail and warehousing and industrial.

Struggling industries that are showing signs of hope are tourism, dine-in, real estate, construction, retail leasing, entertainment, gambling, theme parks and other non-essential businesses.

“2021 will still be below the pre-pandemic 2020 levels; however, the economic recovery will be evident. It will be in 2022 that we will exceed the year 2020 level. The year 2021 will provide the foundation and set the stage for a strong year 2022,” said Yu.

For Filipino-Cebuano Business Club chairman Rey Calooy, the economy and pandemic will coexist.

“While the vaccine is already on its way, we are hopeful that by the third quarter to fourth quarter of 2021, that’s the time the business sector will reinvigorate,” he said.

Another boom in IT-BPM

As one of the gainers during the pandemic, Wilfredo Sa-a, former managing director of the Cebu Information Technology-Business Process Management (IT-BPM) Organization, foresees another boom in the IT-BPM industry.

“The Philippines could see resurgence in the IT-BPM industry. The first major boom for Cebu happened in 2010 after the global financial crisis. Big global businesses developed more appetite for cost savings so they resorted to more outsourcing,” he said.

Again with the pandemic which hit every business without exemption, the businesses will be scrambling to save money, but this time it will be a matter of survival, Sa-a said.

“I have talked to two real estate providers for outsourcing companies, and they themselves are very surprised at the positive behavior of the market. So another boom may be on its way,” he said.

In the retail front, Philippine Retailers Association spokesperson Robert Go said just like in 2020, changes in sales patterns like the preference for food will be the same in 2021 and will slowly normalize in 2022.

“We see 2021’s first and second quarters as the same, which is very subdued but it will be better than 2020. The growth curve will slowly grow with the availability of the vaccine,” Go said.

Travel bubbles, Covid-19 passport

In the tourism industry, Department of Tourism (DOT) 7 Director Shahlimar Tamano said the future of travel will depend on the country’s fight to tamp down the surging Covid-19 cases.

The DOT has been eyeing to link some destinations in the Philippines with other countries with low to zero levels of coronavirus disease cases. It also expressed support on the proposals to implement a globally recognized Covid-19 passport to help restore trust and confidence in the travel and tourism sector.

Cebu Pacific president Lance Gokongwei said the proposed Covid-19 passport is essential as the world reopens international travel vis-a-vis the different vaccines that will be available in the coming year. He said the implementation could be done through government-to-government agreements.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting