Philippines manufacturing sector grows 10.5 pct in April

The country's manufacturing sector continues to post significant growth, boosted by vast improvements in both production and net sales in April 2016 from a year ago, the government said Friday.

Citing the government's monthly integrated survey of selected industries, the National Economic and Development Authority (NEDA) said in a statement that the volume of production index grew by 10.5 percent, a significant improvement from the 1.8-percent growth posted in the same month last year.

It also said that the value of production index recorded a 6.8-percent growth in April 2016, a huge turnaround from a 6.4-percent decline in April 2015.

"Manufacturing output grew stronger at the onset of the second quarter, driven by robust domestic activities during the election season.," said Socioeconomic Planning Secretary Emmanuel Esguerra.

The agency also said that the volume of net sales index posted a growth of 5.3 percent in April 2016 from 1.3 percent last year. The value of net sales index returned to positive territory of 1.8 percent from a 6.8-percent decline in the same month in 2015, it said.

"A bullish business outlook is expected for the second quarter. Higher production volume is anticipated across manufacturing sub-sectors due to the typical increase in demand during summer season and enrolment periods," Esguerra said.

Esguerra, also NEDA director-general, said the stable inflation and interest rates, and sustained foreign investment flows will further support the favorable outlook for the manufacturing sector.

"But still, risks to production growth are anticipated with the possible occurrence of La Nina by the end of the year and the potential recovery of oil prices," he said.

Meanwhile, the manufacturing sector's growth benefited from the robust machinery production, food manufactures, transport equipment, printing, and export-oriented goods.

"Some of these can be attributed to election-related activities and strong domestic consumption," said Esguerra.

He said the manufacturing industry's average capacity utilization remained at 83.4 percent. Among surveyed manufacturing firms, 24.1 percent of the establishments operated at full capacity of 90 to 100 percent.

Also, about 58.2 percent operated at 70 to 89 percent capacity, while 17.7 percent operated below 70 percent capacity

"Current initiatives to sustain the strong performance of the manufacturing sector and to enhance the capacity of industry to be the main growth driver of the economy must be continued," Esguerra said.

These initiatives include the simplification of costly regulatory and bureaucratic procedures, close monitoring of industry roadmaps, and augmentation of public and private investments in research and development. Endit