Nearly one in four manufacturing establishments closed shop as a result of the coronavirus pandemic and the subsequent quarantine restrictions imposed by the government, according to a recent industry survey organized by the Department of Trade and Industry.
Results showed 25.9 percent of the surveyed companies stopped operations, while 53 percent were operating partially. The survey found that only 22.1 percent of the companies were operating fully during the period.
The DTI conducted the survey from June 4 to June 17, 2020 among 2,135 companies.
Trade Secretary Ramon Lopez described the results of the survey as worrisome, and cited the need for the economy to bounce back to help the companies recover from the slump.
“Yes, it’s a cause for worry for any business that closes. But we are confident that we will bounce back, because of good economic fundamentals. We need to save companies first for jobs to restart and recover faster,” he said.
Lopez said despite the slow recovery, there were signs that the economy began to improve following an uptick in the Philippine manufacturing index in April, May and June.
“The IHS Markit Purchasing Manager’s Index also continuously recorded an improvement in manufacturing performance from 31.6 in April to 40.1 in May and 49.7 in June. Aside from this, the output index also saw a rise in production among Filipino goods producers in June at 51.1, marking the first monthly increase in four months,” he said.
PMI data are compiled by London-based IHS Markit for more than 40 economies worldwide. A PMI reading below 50 signals a decline in operating conditions compared with the previous month, while a reading above 50 indicates improvement.
The government started the gradual reopening of the economy in June, allowing critical and essential industries to operate at reduced capacities.
It also allowed the retail sector to open up in June and supported calls for increased operational capacities in July for dining and grooming establishments, with the strictest enforcement of health and sanitation protocol.
Lopez expressed hope the economy would soon recover with these gains and with the projected 2021 growth rate of economic managers at 8 percent to 9 percent.
The DTI will conduct another survey in July to monitor the improvement in trade and manufacturing.