Entry of global retailers boosts local retail sector

CEBU, Philippines – The retail trade sector in Cebu is projected to pick up further as global retailers set up shop in the city.

“The region’s (Central Visayas) retail trade continued to enjoy steady growth amid improving purchasing power of consumers,” the National Economic and Development Authority (NEDA) said in an economic update report.

NEDA cited the opening of new shopping malls in Cebu and the entry of international retail players as key factors that will drive retail growth.

SM Seaside City Cebu, the third shopping center of mall developer SM Prime in Cebu, opened to the public last week.

While Robinsons Land Corp. is also opening its newest mall called Robinsons Galleria next week. Some other shopping centers are also being built in the city.

In an earlier interview with SM Prime President Hans T. Sy, he stressed that mall developments in Cebu are far from saturation.

Sy even cited Singapore and Thailand as examples where there are malls “one after the other” and yet they are surviving despite the high land prices there.

Sy believes that Cebu, as a highly-urbanized area, is entering into that stage where people go to malls to shop and also “enjoy life”.

NEDA further said the entry of global retailers here is an indicator of improved business confidence in the regional economy, citing Swedish brand H&M and Japan’s Uniqlo for opening shops recently in the city.

“The retail trade industry is also expected to benefit from increased household spending as a result of higher purchasing power, strong remittance inflows and election spending,” NEDA noted in the report.

Efren Carreon, NEDA regional chief, said that gadgets, food and clothing remain as the top selling products in the region.

Carreon attributed the rising consumer spending to the growing IT-BPO (information technology-business process outsourcing) and tourism industries which have helped boost income of workers in these sectors.

“This segment of the region’s labor force with their higher incomes are recognized as the new middle class in the country,” NEDA further reported, citing a study from consumer information firm Nielsen which revealed that IT-BPO workers spend a sizable portion of their earnings on the mentioned products. (FREEMAN)