Philippine factory growth hit 10-month high in January

The Philippines opened 2023 with a rebound in factory production after growth hit a three-month low recorded last December, government data released on Thursday showed.

Preliminary results of the Monthly Integrated Survey of Selected Industries (MISSI) of the Philippine Statistics Authority (PSA) showed that the volume of production index (VoPI) expanded by 10.6% year-on-year in January.

The latest expansion compares with the 4.2% in December and 10.9% in the previous year. It is the fastest expansion in 10 months since March 2022’s 346.1%.

Higher annual growth rates were recorded in the manufacture of food products (17.3%), beverages (31.1%), other non-metallic mineral products (22.6%), and other manufacturing and repair and installation of machinery and equipment (30.5%).

After the contractions in December, rebounds were seen in the manufacture of electrical equipment (53.5%), transport equipment (24.3%), wearing apparel (13.7%), recorded media (13.0%), pharmaceutical products (11.2%), textiles (11.1%), tobacco products (1.6%), and basic metals (0.8%).

Meanwhile, slowdowns were reported in the manufacture of leather (14.9%); wood, bamboo, cane, rattan (11.0%); machinery and equipment except electrical (8.4%); chemical and chemical products (6.9%); and paper (0.8%).

Contractions were reported in the manufacture of coke and refined petroleum products (-11.6%); computer, electronic, and optical products (-7.3%); rubber and plastic products (-5.7%); fabricated metal products (-3.0%); and furniture (-18.9%).

The average capacity utilization rate for the month was recorded at 72.6%, higher than the 71.5% recorded in December. Some 21.1% of establishments operated at full capacity, while 39.3% operated at below 70% capacity.

In terms of the value of production index (VaPI), growth clocked in at 15.4%, faster than the 9.5% in December and 15.1% the same month in 2022.

The latest data are in line with results of the S&P Global Philippines Manufacturing PMI, which compiles responses of purchasing managers in a panel of around 400 manufacturers across the country.

“Overall, strong domestic demand fed into higher optimism for the year ahead,” S&P Global Market Intelligence Maryam Baluch said in an earlier commentary.

“Moreover, the lack of COVID restrictions, greater investment in new products and undertaking new projects aided hopes of a prosperous year for the Filipino manufacturing sector,” she added.—AOL, GMA Integrated News