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Business

Factory output surges in March

Louise Maureen Simeon - The Philippine Star

MANILA, Philippines — The country’s manufacturing output rebounded strongly in March, registering a triple-digit growth, after most areas in the Philippines were downgraded to Alert Level 1 as COVID cases dropped.

Factory output, as measured by the Volume of Production Index (VoPI), went up by 336.3 percent in March, significantly quicker than the 75.5 percent in February and a complete turnaround from the 73.3 percent contraction in March 2021.

The latest index is the highest in seven months or since the 521 percent increase in August 2021.

While factory output has been consistently growing since April last year, the March print marks the first time in five months the index recorded a three-digit hike again.

Triple-digit gains were observed for six consecutive months from April to September 2021, largely due to low base effects.

The Philippine Statistics Authority (PSA) attributed the upturn in VoPI in March to the growth of 15 industry divisions led by the manufacture of coke and petroleum products, which surged over 2,100 percent.

This is a huge jump from the 482 percent growth the month before.

The factory output in March is a reflection of the continued reopening of the economy. It was in March when Metro Manila and several other provinces were eased to the most lenient quarantine classification.

This has been the situation for almost three months now as no new spike in COVID cases have been recorded.

Fifteen out of the 22 industry groups covered by the index registered growth during the month.

Most industry groups posted double-digit increases including machinery and equipment (43.2 percent), textiles (24.2 percent), tobacco products (17.1 percent) computer, electronic and optical products (16.1 percent), chemical products (15.8 percent), wood, bamboo, cane, rattan articles and related products (12.2 percent), and rubber and plastic products (10.5 percent).

Other gainers also include basic metals, beverages, fabricated metal products, wearing apparel, furniture, and paper and paper products.

Contractions, meanwhile, were also recorded, led by electrical equipment at 36.5 percent.

Other declines were in transport equipment, non-metallic mineral products, printing and reproduction of recorded media, food products, leather products, and basic pharmaceutical products and preparations.

The growth in the Value of Production Index (VaPI) likewise jumped to 358.2 percent in March from 82.9 percent in February. It was coming off a 74 percent contraction in the same period in 2021.

Further, capacity utilization on the average slightly increased to 70.4 percent from 69.7 percent.

All of the 22 industry groups had at least 50 percent average capacity utilization rate except for the manufacture of leather and related products, including footwear.

This was led by the manufacture of furniture, other non-metallic mineral products, and machinery and equipment except electrical.

Only 23 percent of responding establishments operated at full capacity during the month.

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