Business sentiment among Asian firms rebounded in the third quarter as easing COVID-19 restrictions lifted sales, but lingering uncertainty over the pandemic thwarted a return to business as usual, a Thomson Reuters/INSEAD survey showed.
Asian firms’ outlook for the next six months tracked by the Thomson Reuters/INSEAD Asian Business Sentiment Index jumped to 53 in the third quarter from an 11-year low of 35 in the second, the survey of 103 companies across 11 Asia-Pacific countries showed.
It was also higher than 50 points, which indicates a positive outlook.
The survey comes as the easing of COVID-19 restrictions across Asia has reduced pressure on hard-hit economies, although the experience has varied across the region, with some countries still in recession and others, such as China, seeing a steady recovery.
More than two-thirds of the companies polled said that they saw the pandemic, or a fresh spike in COVID-19 cases, as a top risk.
About 14 percent said that a global recession was their biggest concern, while the rest flagged uncertainty over the upcoming US election in November and other risks.
“We’re recovering with a large dose of uncertainty,” said Antonio Fatas, an economics professor at global business school INSEAD in Singapore.
“If it was just because of Asia, I think the numbers would be more positive, but the reality is the world is not just Asia,” he said, pointing to greater uncertainty in Europe and the US.
The US has reported the greatest number of COVID-19 fatalities, while rising numbers in Europe are threatening to shut down parts of the continent again.
About 28 percent of companies in the third quarter were positive about their outlook, the survey showed, up sharply from 7.6 percent in the second quarter. About 60 percent of the firms polled said that they did not hire or lay off people this quarter, in contrast to the second quarter’s survey in which 63 percent said that they had cut jobs.
Companies polled included Australia-listed Oil Search Ltd, Indian motorcycle maker Hero MotoCorp and Japanese automaker Suzuki Motor Corp.
The survey was conducted between Aug. 31 and Monday last week.
While countries in Asia have had mixed success in containing the virus and its fallout on their economies, the Asian Development Bank expects output in the region to shrink for the first time in nearly six decades this year.
Some investors are shunning Asia’s riskier, high-yielding markets, despite the ample liquidity pumped into the financial system by central banks globally this year.
Satish Shankar, Asia-Pacific managing partner of business consultancy Bain & Co, said that many companies in the region would “need to fundamentally transform their business models” to survive.
Netherlands-based semiconductor equipment supplier ASML Holding NV yesterday said that it is planning to hire an additional 1,000 people in Taiwan this year in response to growing demand from clients. ASML had previously planned to recruit 600 people this year, but that the plan has been adjusted upward, ASML vice president and ASML Taiwan general manager Grace Wang (汪佳慧) told reporters. ASML has a workforce of more than 4,500 in Taiwan, accounting for about 10 percent of its global total, Wang said. This year’s recruitment campaign would focus on adding people in the customer support, manufacturing and supply chain domains to assist ASML
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
Starlux Airlines Co (星宇航空) today unveiled a long-haul network expansion plan at a shareholders’ meeting in Taipei, including direct flights to Barcelona, Spain, and Zurich, Switzerland, as well as a service connecting Taipei, Sydney and New Zealand. Starlux is to become the first Taiwanese carrier to offer non-stop services to the two European cities, while the inaugural oceanic route is expected to expand transit opportunities within the Australia-New Zealand market, Starlux said. Flight services to Chicago, Dallas, Washington and New York are under evaluation, the airline added. Prior to the shareholders’ meeting, the airline earlier this year announced that it would be
Nvidia Corp yesterday announced that CEO Jensen Huang (黃仁勳) would attend an employee meeting in Taipei tomorrow to celebrate the launch of the company’s Taiwan headquarters project. Huang would attend a gathering at the site of Nvidia’s planned headquarters in Beitou Shilin Technology Park (北投士林科技園區), the company said in a statement. After arriving in Taiwan on Saturday last week, Huang told reporters that he plans to meet with Quanta Computer Inc (廣達) chairman Barry Lam (林百里) and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman C.C. Wei (魏哲家), and would attend the groundbreaking ceremony for Nvidia’s Taiwan headquarters tomorrow. Nvidia has not yet applied
RSS