Factory output down anew in January – PSA
Credit to Author: The Manila Times| Date: Tue, 05 Mar 2019 16:20:01 +0000
Factory output continued to fall in January but the contraction was narrower compared to a month earlier, the Philippine Statistics Authority (PSA) reported on Tuesday.
The value and volume of production indices (VapI and VoPI) declined by -0.7 percent and -4.1 percent respectively compared to growth of 10.9 percent and 10.8 percent a year earlier, but improved from the -11.7 percent and -11.9 percent recorded in December 2018.
The National Economic and Development Authority (NEDA), in a statement, said declines in food, basic metals, non-metallic mineral products, chemical products, tobacco, fabricated metals, and machinery (except electrical) contributed to contraction.
But an easing of inflationary pressures, especially on food following the signing of the rice tariffication law, bodes well for a recovery moving forward, it added.
“Manufacturing growth outturn in January 2019 showed a moderate improvement coming from December 2018. Nevertheless, with our recent progress in agricultural policy, we can expect manufacturing to recover further.” Socioeconomic Planning Secretary Ernesto M. Pernia said in a statement.
“The decline in prices of rice and agricultural commodities brought about by the appreciation of peso and the increase in supply of rice imports will improve consumer outlook and prop-up domestic demand,” he added.
Pernia said the passage of the Rice Industry Modernization Law would stabilize inflation and could result in lower cost of inputs for the manufacturing sector.
He added, however, that other measures should also be put in place to attract new investments and reduce the cost of expanding production capacity.
These include full implementation of the Ease of Doing Business-Efficient Government Service Delivery Act of 2018 and the passage of amendments to the Public Service Act, Foreign Investments Act and the Retail Trade Liberalization law.
“These measures are vital considering that manufacturing is expected to be dampened by less optimistic business and consumer outlook in the first quarter of the year.
Higher domestic oil prices, rising adjustment in electricity rates, and weather disturbances are expected to exert upward price pressures on the cost of inputs,” Pernia said.
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