November 17, 2017
MAKATI – “The Philippine economy smashed expectations to post a 6.9% growth as a robust manufacturing industry expanded by 9.4% and increased its share to GDP by 22.4% in the third quarter of 2017,” Secretary Ramon M. Lopez of the Department of Trade Industry stated.
“This economic feat is creating meaningful and well-paying jobs for our people and providing a compelling environment for business to thrive. This is what the Department’s Trabaho at Negosyo thrust is all about,” the Secretary added.
The growth was one of the fastest in the region, outpacing other Asian countries, such as China (6.8%), Malaysia (5.8%), and Singapore (4.6%).
The services sector accounted for the highest share to GDP at 58.9%, followed by the industry sector (33.3%), and agriculture sector (7.5%). Manufacturing accounted for 69% of the total output of industry.
Among the three economic sectors, industry accelerated the fastest at 7.5%, while the services and agriculture sectors grew by 7.1% and 2.5%, respectively.
“We are closing in on our minimum target of growing the manufacturing industry to 25% of the country’s GDP. The Department remains relentless in our efforts to revive our factories, expand production, generate employment, and enable industry to provide the catalyst that will build the seamless link between a productive agriculture and a strong services sector,” Secretary Lopez added.
Food Manufactures, Top Manufacturing Sector
Food manufactures remained the main contributor with 23.6% of total gross value added (GVA) in manufacturing, followed by the manufacture of radio, television and communication equipment and apparatus with 18.6%, and chemical and chemical products with 15.9%.
Manufactures of fabricated metal products posted the fastest growth at 66.8%, followed by furniture and fixture (32.3%), and office, accounting and computing machinery (25.5%).
Retail Trade, Top Services Sector
The GVA of retail trade sector in trade and repair recorded a 6.9% increase in the third quarter of 2017. This was followed by wholesale trade (6.3%), and maintenance and repair of motor vehicles, motorcycles, personal and household goods (5.5%).
Secretary Lopez added that to enable retail trade to realize its full potential as a main contributor to the economy, the Department is supporting the proposed relaxation of foreign equity restrictions, particularly setting of a lower minimum paid-up capital for retail trade enterprises (from US$2,500,000 to US$200,000). This will spur investments into the country, stimulate economic growth, and create more quality jobs for the Filipinos.
Electronic products, Top Merchandise Export
Exports of goods have been growing steadily in 2017, rising by 22.8% and allowing the sector to contribute 54.0% to total GDP in Q3 2017. Electronic products, the country’s top merchandise export, increased by 24.0%, accounted for bulk of total PH export of goods at 63.4%, and contributed 34.2% to the country’s GDP.
Sustaining Manufacturing Resurgence through Innovation
“That efforts of the Department to expand exports, increase investments are finally bearing fruit is also due largely to the private sector’s support,” Secretary Lopez noted. “It is through the concerted efforts of Government and the Private Sector that an environment conducive to manufacturing and industry development can be created,” he added.
Under the Manufacturing Resurgence Program, the Department in collaboration with business and industry champions have finalized 36 industry roadmaps that will pave the way for the development of priority industries.
“We are moving towards the next phase of MRP where strong linkages between large industries and MSMEs will be fostered. The challenge is to sustain the growth and trickle down the effect to smaller industries,” Secretary Lopez said.
Secretary Lopez also emphasized the importance of innovation in sustaining manufacturing resurgence. “We are constantly reviewing our industrial strategy, as we enter the fourth industrial revolution. We are focusing our efforts towards innovation through the inclusive innovation industrial strategy or i3S.”
“This will entail training and upgrading the capability of our people, developing our own or adapting available technologies, and striving towards operational efficiency, to enable us to meet global demands and opportunities and enter a level of inclusive economic growth driven by innovation,” he added.