THE easing of mobility restrictions paved the way for higher manufacturing output growth last month, the Department of Trade and Industry (DTI) said.
The latest IHS Markit report noted that the country’s purchasing manager’s index (PMI) soared to a high of 52.8 in February, an improvement from 50 the previous month, and also the highest since December 2018.
A country’s PMI determines the health of its manufacturing sector and is calculated as a weighted average of five individual subcomponents. Readings below 50 show deterioration in the industry while readings above the 50 threshold signal growth in the manufacturing sector.
“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,” Trade Secretary Ramon Lopez said.
He said the manufacturing and export activities have been allowed to have 100-percent operating capacity even before the shift to Alert Level 2.
“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,” he added.
According to the DTI, 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.”
The growth in manufacturing activities, in addition, were also driven by both output and new orders.
IHS Markit observed that the increase in new orders and buying activity of the manufacturers took cues from recovering domestic demand. This, after the country was hit by the Typhoon Odette and struggled with the recent surge of Covid-19 cases due to the Omicron variant.
“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.
Metro Manila and other areas are under Alert Level 1 from March 1 to March 15.