Moody’s Analytics expects industrial production in the Philippines to significantly grow in 2013 amid government efforts to improve the country’s investment climate.
In its latest report, Moody’s Analytics said investments in infrastructure and projections of sustained rise in consumer demand would help encourage higher industrial production this year.
“Philippines’ industrial production series is volatile, but looking through the noise, it was on a steady uptrend through most of 2012,” Moody’s Analytics said in the report on its outlook on Asian economies.
“Production will continue to grow solidly,” Moody’s Analytics added.
Moody’s Analytics’ projection is consistent with the forecast of the Bangko Sentral ng Pilipinas that the investments of local firms will likely rise this year on the back of improving sentiment on the Philippine economy.
BSP Governor Amando Tetangco Jr. earlier said that rising investments have expanded production capacity in the Philippines.
This is the reason why inflation in the country has remained benign even as demand for goods and services continues to grow.
Latest data from the National Statistics Office showed that the volume of production index of the country’s manufacturing sector grew by 9.6 percent in November from that of the same period the previous year.
In terms of value, production grew by 6.3 percent over the same period.
Moody’s Analytics said production of the industrial sector would likely grow significantly this year also on the back of rising infrastructure spending.
Economic officials have said that infrastructure spending will grow further as more projects under the Public-Private Partnership (PPP) roll out this year.
The BSP also said that the enormous liquidity of banks in the country would help meet rising demand for funds needed to support investment initiatives.
Even as bank lending grew by a double-digit pace last year, Tetangco said, banks still have room to lend more aggressively in 2013 given their resources.