PH manufacturing up 8.4% in February

MANILA, Philippines – The manufacturing sector continued its strong start in February on the back of increased production of furniture, food products, and rubber based on data released National Economic and Development Authority (NEDA) on April 12.

The Philippine Statistics Authority’s (PSA) Monthly Integrated Survey of Selected Industries for February 2016 showed that the Volume of Production Index (VoPI) grew by 8.4%, a sharp about face from the 2.1 % decline seen in February 2015.

The Value of Production Index (VaPI) recorded more modest growth of 2.8%, albeit an improvement on 7.6% decline recorded in the same period last year. 

“The manufacturing sector is expected to sustain growth this year because of our strong macroeconomic fundamentals, resilient domestic consumption, and upcoming national elections,” said Socioeconomic Planning Secretary Emmanuel F. Esguerra.

He added that the anticipated increase in gross revenues of the ocuntry’s large corporation add to the manufacturing’s positive outlook.

A strong manufacturing sector helps employment while stable prices of commodities, government assistance such as the Pantawid Pamilyang Pilipino Program (4Ps), and election-related spending will also provide additional boost to domestic consumption, Esguerra noted.

While strong domestic consumption boosted the manufacturing sector, weak global demand caused a slight drop of 2% in exports of manufactured goods.

Consumer goods

For consumer goods, furniture and fixtures recorded strong growth on the back of robust domestic demand, posting an increase in volume of 32.4% and value of 13.2 % in February 2016. 

Likewise, the food subsector sustained double-digit growth in February, posting a 26% and 25.8% growth rate in volume and value of production, respectively.

“Driven by strong consumer spending and efficient distribution of goods, the growth in food production is expected to continue in the coming months as El Niño is anticipated to weaken and fade away during the second quarter of 2016,” said Esguerra.

Intermediate and capital goods

For intermediate goods, rubber and plastic products posted a double-digit growth of 25.6% in volume and 1.5% growth in value of production. 

As for capital goods, electric machinery grew by 16.3% and 8.3 % in volume and value, respectively.

Esguerra also pointed out that the current global low oil price environment will lower production costs and in turn encourage expansion of manufacturing production.

“To maximize low oil prices, the government must ensure that stable macroeconomic fundamentals are sustained and measures to further reduce cost of doing business are continually pursued,” he said. – Rappler.com