PHILIPPINE manufacturing output likely grew by 4.1 percent in September, accelerating slightly from August’s 2.8 percent, Moody’s Analytics said in an estimate ahead of the release of official data this week.
The Philippine Statistics Authority is scheduled to detail September factory data on Friday, November 10. If Moody’s Analytics’ forecast is realized, growth would be slower compared to the 11.2 percent posted a year earlier.
“Although the Philippines has a small export-manufacturing sector compared with other economies in the region, industrial production has still benefited from the upswing in global demand, ” the economic research unit of Moody’s Investors Service said.
Moody’s Analytics noted that exports of electronics and components were up 10.9-percent year-on-year as of August compared to a 1.8-percent rise in the same period last year.
“Firm external demand along with strong investment, which is driving up production of products such as cement, are expected to continue supporting industrial production,” it said.
The outlook is consistent with the government’s view that manufacturing output will improve in the last quarter of the year.
“Sustained infrastructure development, translating to [an]increase in public construction expenditure, is anticipated not only to increase the growth of the manufacturing sector but also to support the continuous growth of the economy,” Socioeconomic Planning Undersecretary Rolando Tungpalan has said.
“The local production capacity and efficiency of construction-related manufacturers must be expanded to support our initiative of massive spending in infrastructure programs and projects,” he added.
Still, Tungpalan said risks and uncertainties remained.
“Short-term upward inflationary pressures such as [an]increase in global oil prices, as well as price increases in fish, corn, vegetables, flour and other cereal products, may affect cost of production. Typhoon occurrences may also interrupt business activities, resulting in lower manufacturing output,” he said.