Philippine manufacturing for Jan records strong expansion

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Philippine manufacturing for Jan records strong expansion
Image by Mimzy from Pixabay
• The Philippine manufacturing sector expanded in January 2023, driven by growth in the manufacture of food products, transport equipment, and electrical equipment
• The Volume of Production Index for manufacturing rose 10.6% while the Value of Production Index climbed 15.4%
• It was the 22nd straight month of increases in both VoPI and VaPI
• The average capacity utilization rate for the manufacturing sector in January was reported at 72.6%, improving from 71.5% in December 2022

The Philippine manufacturing sector expanded in January 2023, driven by growth in the manufacture of food products, transport equipment, and electrical equipment, according to the Philippine Statistics Authority (PSA).

The Volume of Production Index (VoPI) for manufacturing recorded a double-digit, year-on-year increase of 10.6% in January, faster than December 2022’s 4.2% growth, but lagging the 10.9% in January 2022, according to the latest Monthly Integrated Survey of Selected Industries (MISSI) by PSA.

The Value of Production Index (VaPI) likewise achieved double-digit growth of 15.4% in January, faster than the 9.5% logged in the previous month and the 15.1% growth in January 2022.

This was the 22nd straight month of increases for both VoPI and VaPI. The VoPI upturn in January was mainly brought about by the annual increases in the indices of the top three industry divisions, namely manufacture of food products, 17.3%; manufacture of transport equipment, 24.3%; and manufacture of electrical equipment, 53.6%.

Fourteen other industry divisions registered varying levels of growth, while four industry divisions registered negative annual rates with the manufacture of fabricated metal products, except machinery and equipment, recording the fastest annual drop of -3%.

For VaPI, the same top three industry divisions also shared the biggest improvement with manufacture of food products at 25.1% growth, manufacture of transport equipment with 24.1%, and manufacture of electrical equipment with 55.3% growth. Fifteen other industry divisions also recorded varying levels of growth while four industry divisions recorded negative annual rates in January 2023. The manufacture of furniture industry division recorded the fastest annual drop of -16.9%.

Based on MISSI’s responding establishments, the average capacity utilization rate for manufacturing sector in January 2023 was reported at 72.6%, an improvement from 71.5% in December 2022.

Almost all the industry divisions reported capacity utilization rates of more than 60%, except for manufacture of paper and paper products, which closed at 56.1%.

The top three industry divisions in terms of reported capacity utilization rate were manufacture of wearing apparel at 78.3%, manufacture of machinery and equipment except electrical at 77.8%, and manufacture of transport equipment at 7.3%.

Overall, 21.1% of the surveyed establishments said they operated at full capacity (90% to 100%) while 39.6% operated at 70% to 89% and 39.3% operated below 70% capacity.