The country’s factory output recorded a slower growth in March, according to the Philippine Statistics Authority (PSA).
The PSA’s monthly integrated survey of selected industries showed that the Volume of Production Index (VoPI) for manufacturing registered a year-on-year increase of 2.2 percent in March 2023, but slower than the February 2023 annual growth of 5.2 percent.
In March 2022, the VoPI even recorded a faster annual acceleration of 346.2 percent.
The PSA said the slower annual growth of VoPI in March 2023 was mainly brought about by the lower annual rates in the manufacture of beverages, 4.9 percent from 20.9 percent in the previous month; chemical and chemical products, -25.5 percent from -7.8 percent in the past month; and basic metals, 18.6 percent from 28.1 percent in February 2023.
The agency added 11 out of the remaining 19 industry divisions posted negative annual growth rates in March 2023. The highest annual decline was led by manufacture of wearing apparel registering an annual downturn of 40.2 percent.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said the slower growth in manufacturing volume of production may have to do with normalization of base effects, as well as dragged by elevated prices and financing costs.
“The risk of US recession which is the world’s largest economy that partly dragged both exports and imports in recent months, thereby also partly slowing down local manufacturing activities,” Ricafort said.
“Nevertheless, the continued growth in manufacturing volume of production, though at modest single-digit levels, could have still benefited from the further reopening of the economy towards greater normalcy with no more COVID restrictions and no more large scale lockdowns since 2022,” he added.
The Value of Production Index (VaPI) for manufacturing also recorded a slower increase of 4.9 percent in March 2023 versus annual growth of nine percent in the previous month. In March 2022, the VaPI accelerated annually with a three-digit growth rate of 370.3 percent. – Angela Celis
