Factory output seen sustaining growth in Q3, says NEDA
The National Economic and Development Authority (NEDA) expects manufacturing growth to be sustained in the third-quarter after the sector’s performance yielded positive results in July.
The Monthly Integrated Survey of Selected Industries (MISSI) for July of the Philippine Statistics Authority showed both the Volume of Production Index (VoPI) and Value of Production Index (VaPI) rising by 11.8 percent and 12.2 percent, respectively.
The July results were a turnaround from the 5.1-percent and 6-percent decline of VoPI and VaPI, respectively recorded in the same period last year.
“We expect this strong performance of the manufacturing sector this year as we continue to see stable domestic demand, as well as robust investments due to heightened infrastructure projects and consumer spending,” Socioeconomic Planning Secretary Ernesto M. Pernia said.
Growth in the food subsector was due to strong household consumption and efficient market operations. Food manufacturing value was mainly driven by increases in the production value of animal feeds and sugar.
The double-digit growth in the value of refined petroleum products continued to push the overall increase in the value of petroleum products in July.
Meanwhile, growth in the production volume of construction-related manufactures slightly slowed down in July with slight declines in cement production and miscellaneous non-metallic minerals.
Volume of production of glass and basic metals, however, posted double-digit growth. Net sales of non-metallic mineral products and basic metals also rose.
Growth in the production volume of most export-oriented products was sustained in July 2018.
The increase in petroleum products, textile, beverages and non-electrical machinery offset the declines in the production volume of tobacco, footwear and wearing apparel, wood products, and furniture and fixtures.
High importation of raw materials and intermediate goods supported the increase in production levels of exportoriented goods.
Production and sales of transport equipment recovered at the beginning of the second semester of 2018 after two consecutive months of contractions. The improvement is consistent with car manufacturers’ improved outlook on automotive sales.
“This upward growth trajectory is likely to be sustained. And the whole of government continues to push for measures improving efficiency and innovation in the production sector in order to sustain this robust performance in the second half of the year,” Pernia said.
These measures include encouraging competition in the local logistics sector to translate to better services and lower prices for customers, effective internationalization of Micro, Small, and Medium Enterprises, and improvement of local government units’ efficiency in providing business-related services.