The country’s manufacturing sector was nearing stable conditions in November, IHS Markit Philippines Manufacturing Purchasing Managers’ Index (PMI) survey reported yesterday.
Domestic manufacturing PMI last month improved to 49.9 from a 48.5 score in October.
Indices above 50 show increased activities in the manufacturing sector and below 50 reflect deterioration.
“The Filipino manufacturing sector showed promising signs of renewed recovery momentum in November as the headline PMI figures neared stabilization. Production rose for the first time since June as foreign demand improved notably from that seen in October,” IHS Markit economist Shreeya Praya said.
The report added production volumes went up midway through the last quarter of the year.
Surveyed firms attributed this improvement in output to the reopening of businesses and softer reduction in new orders.
The IHS Markit survey also highlighted that job shedding in November eases to the slowest pace in nine months.
“Encouragingly, firms registered (the) slowest drop in employment in the current nine-month sequence of decline despite a steep depletion in backlogs of work,” Praya added.
Meanwhile, the recent developments on the coronavirus disease 2019 (Covid-19) vaccines raised hopes among Philippine-based manufacturers as their business outlook for the next 12 months remained positive.
“Nevertheless, the path to recovery may not be smooth. The health of the sector rests on the number of Covid-19 cases and the impact the virus has on the global economy. Whilst, vaccine developments look promising, it is still unclear when restrictions will come to a complete end,” Praya said.
Meanwhile, the country’s ambassador to Japan, Jose Laurel, said that, “Based on my experience as Philippine ambassador to Japan, I can see that the Japanese continue to be excited about doing business in the Philippines. They see the Philippines as a lucrative market for Japanese products and services.”
At the Philippines-Japan Business Investment Virtual Forum 2020, organized by the Nikkei Group Asia, Laurel said Japan’s continued interest in the Philippines will help the country in its recovery efforts to rise from the Covid-19 crisis.
He added that Filipino workers are highly regarded for their skills, making the Philippines an attractive destination for Japanese investors.
Laurel also cited a study by Japan External Trade Organization indicating that as of 2017, around 1,502 Japanese companies were operating in the Philippines and employing some 320,000 Filipinos. Sixty percent of these Japanese firms are export manufacturers. They exported USD13.3 billion worth of products, accounting for 26 percent of Philippine merchandise export back in 2017, the envoy added.*PNA