Business confidence in Singapore is waning

A survey revealed that there is uncertainty in the macro level - will Singapore's confidence in business prospects drop even more?

The Sage Group PLC released the survey results of its third Sage Business Index– International Business Insights. Polling over 10,000 businesses across Europe, North America, Africa and Asia, the index shows that while confidence in the global economic outlook continues to decline, the outlook for local market conditions and businesses is improving.

While confidence in their own business prospects (business outlook) has improved as a whole against the last index, there has been a slight drop in the rate of growth, with 67 percent of businesses experiencing either neutral or positive growth, a drop of two percent on September 2011. This can perhaps be explained by their concerns over the rising costs of fuel and raw materials which is the number one obstacle to growth. However, the improvement in both local economic confidence and business outlook suggests a more optimistic mood exists within individual companies.

Looking at the data from a regional level, the findings also mirror the broader economic news agenda. The UK and the US, who were the most pessimistic of the countries surveyed in September 2011 (with country index scores of 40.65 and 41.53 respectively) have both improved (44.97 and 49.28 respectively) while Euro-zone countries, Germany, Spain and France have all seen drops in confidence. Malaysia and Singapore are still confident with a score of 51.53 but this is down from 53.26 the last time.

The good news is that the steep decline in confidence between the first two surveys has been arrested. Although there has been a 0.52 drop in the Index score for global economic confidence, this is much lower than the 7.7 reduction witnessed between the March 2011 and September 2011 surveys. This suggests that the overall trend of stability and growing confidence in local economies and individual company performance is likely to continue.

Mr Guy Berruyer, Chief Executive of The Sage Group said: “Yet again we are seeing uncertainty at a macro level tempered with some optimism at a micro level. This suggests companies are extremely focused on the day-to-day challenge of simply staying in business. These generally positive figures around business confidence indicate that the green shoots of recovery are definitely here. Governments in each market should do all they can to harness and help the entrepreneurial spirit that already exists”