INDUSTRIAL output increased in November from a year earlier, helped by petroleum products, the latest Monthly Integrated Survey of Selected Industries (MISSI) released by the Philippine Statistics Authority (PSA) on Tuesday showed.
The manufacturing sector also surged compared with October.
The National Economic and Development Authority (NEDA) said manufacturing output continued to show strong growth due to higher production of petroleum products, transport equipment, and food.
The sector is likely one of the growth drivers of the Philippine economy in the last quarter of 2016, it said.
Volume and value up
The volume of production index (VoPI) grew by 14.6 percent in November from 4.4 percent a year earlier. It was also faster than the revised 11.3 percent in October.
“Significant expansion in VoPI was observed in six sectors led by petroleum products with an increase of 80.3 percent. Other sectors with two-digit annual rates were transport equipment (40.4 percent), food manufacturing (24.6 percent), rubber and plastic products (16.1 percent), tobacco products (11.1 percent) and beverages (10.3 percent),” the PSA said.
The value of production index (VaPI) rose by 10.6 percent from -2.2 percent in the same comparable period, and from the revised 6.9 percent in the previous month.
“Among the 10 major sectors reporting increments in VaPI, seven major sectors significantly contributed to the increases, namely: petroleum products (68.8 percent), trans port equipment (39.1 percent), food manufacturing (26.7 percent) and beverages (15.1 percent), rubber and plastic products (14.2 percent), tobacco co products (11.3 percent) and textiles (10.4 percent),” the PSA noted.
In a separate statement, Socioeconomic Planning Secretary Ernesto Pernia explained the food subsector registered double-digit growth in both production and sales due to favorable farming conditions.
The food subsector registered a volume of production rate of 24.6 percent, and a value of production rate of 26.7 percent from a 10-percent decline in both volume and value last year.
The production value of petroleum products has been growing steadily for three consecutive months, following consistent declines since 2015. The petroleum subsector posted 80.3 percent and 68.8 percent growth rates for volume and value of production, respectively.
The transport equipment subsector posted 40.4 percent growth in production volume and 39.1 percent growth in production value. “This growth was supported by local demand for vehicles such as passenger cars, light trucks and buses,” Pernia said.
Manufacturing, together with strong consumption and investment will support the Philippine gross domestic product to grow by 6.8 percent to 7.4 percent in the fourth quarter of 2016, the Cabinet official noted.
It should bring the full-year growth to 7 percent, or the upper end of the government’s official 6 percent to 7 percent target, he added. The Philippine economy grew by 7.1 percent in the third quarter of 2016.
Pernia said the manufacturing sector is expected to exhibit stronger growth in December 2016 because of increased consumer demand during the Christmas season of 2016 compared with 2015.
“Looking ahead, we see the sector benefitting from strong private and public investments,” he said.
“Low inflation, low unemployment and strong remittances will also continue to drive domestic demand, and will boost manufacturing in the Philippines,” he added.
Pernia said the government must continue to pursue efforts that boost the country’s manufacturing sector and provide quality jobs.
“One is through encouraging innovation in manufacturing so that we remain competitive with the rest of the world. Second, we need to minimize bureaucratic procedures and regulatory barriers to attract investments and to reduce the cost of doing business and expand production capacity,” he said
“Lastly, we must make sure that the technical skills of our labor force are in line with industry needs, and that opportunities to enhance technical competencies are available to people in the low-income and far-flung areas of our country,” Pernia added.