After a three-month decline, the Philippine manufacturing sector bounced back in August 2015 on the back of vigorous construction activity and high demand for automotive products, according to the National Economic and Development Authority (NEDA).
According to the Philippine Statistics Authority’s Monthly Integrated Survey of Selected Industries for August 2015, the manufacturing sector’s Volume of Production Index (VoPI) increased 3.7%, a big improvement from its performance in the past three months.
However, the VoPI remains behind the 5.7% growth it posted in the same month last year.
“We must continuously drive domestic demand to offset the low global demand and strengthen the link between the agriculture and manufacturing sectors to reduce the economy’s vulnerability to external supply shocks,” Economic Planning Secretary Arsenio Balisacan said.
Meanwhile, the Value of Production Index declined 4.6% for the month in review.
For consumer goods, manufacture of beverages led the growth in value of net sales, as it posted a 19.1% improvement in August. Tobacco also posted a double-digit growth in both value and volume of net sales. On the other hand, the food subsector dropped further in both value and volume of net sales due to the persistent decline in the production values of vegetable/animal oils and fats, grain mill products, processed meat and fish, milk and dairy products.
For intermediate goods, wood posted a double-digit growth of 37.9% and 11.8% in volume and value of net sales, respectively. Meanwhile, non-metallic mineral products sustained its double-digit growth at 28.6% and 21.1% in volume and value of net sales due to the continuing demand for construction-related materials from both the private and public sectors.
On the other hand, petroleum continued to slip, posting a 25% drop in value of net sales due to an oversupply in the global market. On a positive note, production is seen to increase by next year with the completion of a refinery master plan by a major corporation, NEDA noted.
For capital goods, fabricated metal products grew 22.3% and 24.2% in volume and value of net sales respectively. However, net sales of basic metals continued to contract with 28.1% in volume and 37.9% in value due to the decrease in production and value of non-ferrous metals and an oversupply of basic metals globally.
“We remain optimistic for the fourth quarter due to the expected boost in both production and sales of manufactured goods with the coming holiday season, campaign season for the 2016 elections, and the expansion of the BPO (business process outsourcing) industry,” the Cabinet official said.
“This, together with the improved employment situation, low inflation rate, declining oil prices and the sustained remittances from overseas Filipino workers, will support the business confidence in the coming months,” Balisacan added.
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