MANILA – Growth in the manufacturing sector accelerated in November 2015, according to the National Economic and Development Authority (NEDA).
In the Philippine Statistics Authority’s Monthly Integrated Survey of Selected Industries for November 2015, the Volume of Production Index (VoPI) grew by 7.5 percent, significantly faster than its 1.7-percent growth in the previous month. Also, the Value of Production Index (VaPI) increased by 1.0 percent in the same month after posting declines since April 2015.
“The increased growth in manufacturing despite the continued weak global demand shows the resiliency of our domestic economy. This could also potentially support stronger fourth-quarter 2015 growth of the industry,” said Economic Planning Secretary Arsenio M. Balisacan.
He added that the sector is expected to grow further until December 2015 on the back of robust domestic demand, increased inflow of remittances, stable inflation, and low fuel prices.
“We must aggressively pursue efforts to encourage innovation to help the manufacturing sector realize its potential as driver of economic growth. We have to explore and invest in new technology to enhance existing product base to maintain competitiveness in the regional and global market,” said Balisacan, who is also NEDA Director-General.
For consumer goods, tobacco maintained its robust growth in November 2015, posting a 52.7- and 54.1-percent growth rate in volume and value of production, respectively, despite the slowdown from its three-digit growth in the previous month.
On the other hand, the food subsector continued to decline in both production volume and value, registering a contraction of 10.0 in volume and 9.8 percent in value. This is due to the plunge in the production triggered by the low demand for tuna products, low supply of agar, and inadequate supply of raw materials for the production of vegetable and animal oils.
For intermediate goods, leather goods posted a double-digit growth of 23.7 and 24.9 percent in volume and value of production. For capital goods, basic metals grew by 25.1 and 11.3 percent, sustaining its robust growth from the previous month, offsetting its negative performance since May.
The transport sector also grew by 9.5 in volume and 8.7 percent in value due to the sustained strong sales in passenger and commercial vehicles.
Meanwhile, the average capacity utilization slightly grew to 83.6 percent from 83.5 percent last year, with basic metals posting the highest utilization rate of 88.6 percent. Among surveyed firms, 25.4 percent are operating at full capacity (90-100%), 55.8 percent at (70-89%) and 18.8 percent operating at below (70%) capacity.
“We need to raise the productive capacity of MSMEs by upgrading skills and improving access to financing, which will enhance their capacity to expand and participate in the global value chain,” the Cabinet official said.
The business sector is expected to benefit from the realization of an ASEAN Economic Community (AEC), which is expected to accelerate investments, create additional employment, and generate more income in the Philippines.
“To fully benefit from the ASEAN economic integration, the government needs to improve the business climate by amending restrictive legislation and simplifying complicated business-related processes and regulations,” said Balisacan.