Rising demand revved up Philippine factory output by 5.1% in October
The volume of factory output continued to expand at 5.1 percent in October from 4.1 percent in September, on the back of expansion posted in more than 10 industries, the Philippine Statistics Authority (PSA) reported on Wednesday.
The PSA said the growth of the volume of production index—a proxy for factory output—during the month was driven by the gains in 14 industries, led by the manufacture of machinery and equipment, except electrical.
The other industries include those in the manufacturing of beverages; transport equipment; chemicals and chemical products; fabricated metal products, except machinery and equipment; computer, electronic and optical products; and coke and refined petroleum products.
The other half of the list are other manufacturing and repair and installation of machinery and equipment; wood, bamboo, cane, rattan articles and related products; paper and paper products; rubber and plastic products; leather and related products including footwear; textiles; and basic pharmaceutical products and pharmaceutical operations.
Despite the month-on-month growth, it was lower than the 27 percent growth in the same month in 2021.
Rizal Commercial Banking Corp. chief economist Michael Ricafort offered an explanation, citing the slower growth may have to do with the higher base in 2021 caused by the sharp decline in 2020 due to the Covid-induced large scale lockdowns.
“Nonetheless, the modest, single-digit growth in the manufacturing volume production continued to pick up as the economy further reopened toward greater normalcy, with no large lockdowns so far this year and no lockdowns going forward as a priority of the administration,” said Ricafort.
He said that the overall growth could be largely attributed to the further reopening of the economy toward greater normalcy.
He explained these include the government making the face mask mandate voluntary, albeit with a few exceptions, the further easing of restrictions on foreign and local tourism, and the resumption of in-person schooling.
Speaking of prospects, Ricafort said that global supply chain disruptions and constraints are presenting some opportunities for local manufacturers to service increased international demand.
This, according to him, is manifested by Philippine exports at near record highs recently, benefiting some export-oriented local manufacturers.