Cebu bizmen confident RP can survive crisis

Although several apprehensions of a possible economic bend next year, Cebu-based businessmen said the full adverse impact of the credit crunch in the US will be felt by the economy in the first quarter of next year. They, however believed the Philippines, especially Cebu, can pull it through.

"Philippines can stand on its own. We (Filipinos) have proven our resiliency in the many crises that we have survived," said Architect Benjamin Avila, president of Avila Architects.

He said the construction and real estate industry, specifically, will slow down in during the period as companies adopt a "wait-and-see" attitude and shelve off projects until the US economy stabilizes. Rentals of buildings are also expected to go up next year.

Avila said the drop in the price of steel bars has kept the construction industry moving up this quarter, as companies have not stopped ongoing construction projects.

"But it would be difficult to start new projects, especially next year with the economic uncertainty in the US," he said.

Avila further advised people who are liquid to invest in real estate, especially in the US.

Although prices of construction materials have plunged by an average of 40 percent in the last few months, industry leaders see a significant slowdown of construction activities in Cebu next year, as capitalists are adopting "wait and see" attitude amid the unpredictable economic landscape.

Cebu Oversea Hardware group, the biggest hardware chain in Metro Cebu, which has outlets in other cities like Metro Manila, is now bracing for the projected construction slowdown in 2009, as declining sales has been felt by the group as early at this time.

"Everybody is cautious of what will happen with the projected global recession," said Carlos Co chairman of Oversea Hardware Corporation, the operator of Cebu Home Builders chain of outlets, as well as Expo Showroom stores located in Cebu, and in Metro Manila.

Co said that expansion projects and the start of new projects altogether would slow down next year.

He said industry leaders in the construction sector noted that developers are adopting a "wait-and-see" attitude as the economic slowdown in G8 countries like Europe and the United States continues to send ripple effects on the local economy.

Prices of steel bars for instance in Metro Cebu have gone down some 40 percent in just two months from P65 to P40 per kilogram, while cement remained steady.

However, Co said developers are wary the economic problems in developed countries would finally hit the local economy.