Philippines stays in SE Asian manufacturers’ lead
PHILIPPINE MANUFACTURING is alive and kicking. The country’s marketing performance surpassed those of the other Association of Southeast Asian Nations (ASEAN) members for the third consecutive month in December, according to a monthly survey conducted by IHS Markit for Nikkei, Inc.
The Nikkei Philippines Manufacturing Purchasing Managers’ Index (PMI) showed that the country was able to log a “solid increase” to 54.2 in December, a score that’s even higher than the regional average of 49.9.
Meanwhile, Vietnam placed second with a 52.5 signaling a “moderate increase” from its manufacturing performance in November. Myanmar is on the third spot with 51.1, and Thailand came in fourth with 50.4.
The manufacturing PMI is made up of five sub-indices, with new orders getting the biggest chunk at 30%, followed by output (25%), employment (20%), delivery times of suppliers (15%), and stocks of purchases (10%).
A PMI reading higher than 50 suggests improved operating conditions from the previous month, while a score lower than that could mean deterioration.
Malaysia, Indonesia, and Singapore experienced “marginal” and “sharp” decreases, hitting the below 50 threshold at 49.9, 49.3, and 44.7 respectively.
IHS Markit Principal Economist Bernard Aw said in the report that client demand “softened” across the region, which resulted in the manufacturers’ reduced purchasing.
“The Nikkei survey data showed that output growth slowed and new orders failed to expand for the first time in five months,” he said.
Aw also added that there was “little support” from external markets as export sales dropped at the end of the year.
Nevertheless, Land Bank of the Philippines Market Economist Guian Angelo S. Dumalagan positively expressed how the Philippine government’s increasing public spending in 2018 should be able to support the expansion of the country’s manufacturing and encourage investor optimism.
“This solid growth is expected to persist in 2018, as overall economic activity could accelerate further amid the government’s ambitious infrastructure program and tax reform,” Dumalagan said.
“Based on the crossborder investment database of Bureau Van Dijk, foreign companies have announced or are expected to announce at least 24 projects in the country’s manufacturing sector as of December 2017,” he added.
These projects mainly come from China, Japan, and Europe.
via BusinessWorld / Elijah Joseph C. Tubayan
