THE country’s manufacturing sector likely slumped at the end of 2015, as the drag in the Philippines’s agricultural sector weighed in on the production of food items during the period.
In its weekly assessment of economic indicators in the Asia-Pacific region, Moody’s Analytics—the research arm of Moody’s Inc.—said the country’s industrial production likely grew by 1.5 percent in December 2015.
This is a decrease from the 7.5-percent growth of the sector in November last year.
“Food manufacturing will continue to be a drag on output due to dry conditions affecting crop output,” Moody’s said.
The slowing global economy—particularly in advanced economies—is also likely to pull the manufacturing sector’s growth downward during the period.
“Export-oriented manufacturing is expected to be dented by the slowingChinese economy. This will be offset somehow by a rise in demand from the US as its recovery continues,” Moody’s Analytics said.
The Philippine Statistics Authority’s (PSA) monthly integrated survey of selected industries for November 2015 showed that the volume of production index grew by 7.5 percent in November 2015, due largely to the robust growth in the tobacco sector.
In particular, seven of 11 major industries mainly drove volume of production index growth. These were tobacco products, which grew by 52.7 percent; machinery except electrical, 29.6 percent; basic metals, 25.1 percent; leather products, 23.7 percent; electrical machinery, 20.1 percent; petroleum products, 12.5 percent; and footwear and wearing apparel, 12 percent.
Food production, meanwhile, still registered a decrease in the month.
The recovery of the manufacturing sector last November was lauded by economic managers, saying that it shows the resiliency of the domestic economy despite continued weak global demand.
The manufacturing-sector growth at the end of the year will be released by the PSA on Tuesday.