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Philippines maintains high performance for manufacturing in March

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The country’s manufacturing score remained strong in March this year, with the purchasing managers’ index (PMI) reaching 53.2, up from 52.8 in February.

The S&P Global Manufacturing PMI, formerly known as IHS Markit said, on Friday, manufacturing score last month was the highest since December 2018, indicating a significant improvement in the state of the local manufacturing sector.

It attributed the strong manufacturing performance last month to the relaxation of restrictions imposed after Metro Manila and other key areas of the country were designated as Alert Level 1.

It received new orders and increased output in the previous month, with demand for Philippine-made goods increasing at the fastest rate since July 2019.

“Whilst the country recovers from the pandemic, with alert levels downgraded and restrictions eased, international concerns and supply-side performance constrained the momentum growth,” S&P Global economist Maryam Baluch said.

Baluch went on to say that the conflict between Ukraine and Russia, as well as the rising coronavirus disease 2019 (Covid-19) cases in China, created supply bottlenecks, which exacerbated the delivery time of inputs.

“(I)nflationary pressures reached record-highs as cost burdens and selling prices rose at faster paces,” she said.

Last month, factory headcount fell as a result of resignations and cost-cutting initiatives reported by companies.

Meanwhile, the outlook for Philippine-based manufacturers for the next 12 months remains positive, owing to the relaxation of restrictions, increased demand, and a favorable election result.

“That said, solid upturn in demand and output led to manufacturing expectations remaining strongly optimistic. Firms sustained hopes that Covid-19 will pose a lesser threat to the economy and demand will continue to pick up,” Baluch said.

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