Firm global demand for merchandize goods still accounted for growth in Philippine manufacturing output in Janu-ary, which Moody’s Analytics estimated at 15 percent.
Such a rate of increase, however, would reflect a sharp slowdown from a 23 percent rise recorded in the Volume of Production Index (VoPI) in December 2016 and from 35.8 percent growth in January of that year.
The economic research arm of Moody’s Investors Service issued its research note over the weekend, ahead of the release of official January manufacturing output data by the Philippine Statistics Authority (PSA) on Friday, March 10.
Focus only on 15% growth
“We expect Philippines manufacturing conditions to have remained strong in January,” Moody’s Analytics said in its research note.
The research note attributes the expansion of Philippine producers’ output to still strong global demand.
“This is most visible in improvements in electronics production,” it said.
Moody’s Analytics, however, did not specify the reasons for its estimate of a much slower rise of 15 percent in the VoPI in January, compared with the preceding month’s 23 percent and the year-earlier’s 35.8 percent growth.
Global economies continue to show slow recovery. Many analysts believe that high unemployment amid slow growth has become the new normal in the US and other developed economies in the West.
This does not bode well for their trade partners, such as the Philippines, with manufacturing, particularly export-ers, poised to be the hardest hit.
Apart from slow global growth, the new US president’s ‘America First’ stance could also bring back mercantilist pol-icies, according to Lombardi newsletter columnist and international relations expert Alessandro Bruno.
“Mercantilism wants to protect local products from external competition, while aggressively promoting exports and industrialization,” he wrote in his column last week.
Socioeconomic Planning Secretary Ernesto Pernia had said the proposed Philippine Development Plan 2017-2022 cited strategies that could boost the manufacturing sector.
“We must further encourage the expansion of the capacity of existing firms, entry of new ones and facilitate link-ages across firms and sectors. The use of science, technology and innovation must also be promoted. We must also enhance the competencies of our labor force to produce high-quality and competitive products,” Pernia said.