The manufacturing sector posted its fastest growth in more than three years, as the Philippines purchasing manager’s index rose to 52.8 in February 2022 from 50.0 in January.
IHS Markit Philippines said its analysis showed that it was the highest jump of the PMI in 38 months, which gauges the output of the manufacturing sector since December 2018.
Trade Secretary Ramon Lopez attributed the growth in the manufacturing output to the continued easing of economic restrictions amid the challenges of the COVID-19 pandemic.
“The climb in the country’s PMI in February is a result of the consistent and sustained efforts, together with the continued cooperation of our countrymen, in working towards the recovery of our economy. Last month’s performance is an indication of the sector’s solid growth in output, new orders and exports thanks to easing of mobility curbs as the Omicron surge fades,” he said.
Lopez said even before the country shifted to Alert Level 2, manufacturing and export activities were allowed at 100-percent operating capacity.
“Thus, with the recent de-escalation of Metro Manila and other provinces to Alert Level 1, we expect March PMI to remain above 50 on sustained manufacturing growth recovery, underpinned by economic reopening and greater mobility,” Lopez said.
The PMI considers new orders, output, employment, suppliers’ delivery time and stock. Readings above 50 signal growth and below that, a contraction.
The latest report showed a resumption of improvement in the Philippines manufacturing sector and indicated the strongest improvement in the health of the sector since December 2018.
Growth was centered on expansions in both output and new orders with the rate of increase in the former the quickest for over three years.
HIS Markit said that following the aftermath of typhoon Odette and the surge in COVID-19 cases due to the Omicron variant, the increased new orders and buying activity of manufacturers were due to improvements in the domestic demand environment, the sharpest in over three years.
Exports also rose during the month, bringing an end to four successive months of contraction.
“We look forward to a full economic recovery this year as we recently de-escalated to Alert Level 1. Barring other issues, we project to surpass the 2019 GDP levels this year and we remain committed to strengthening our efforts and in adapting our responses to ensure the safety of our countrymen as we reopen more sectors,” Lopez said.