MANILA - The Department of Trade and Industry said the manufacturing sector is recovering after suffering a steeper decline than the rest of the economy because of the COVID-19 pandemic.
Trade Secretary Ramon Lopez, who himself was just diagnosed with COVID-19, said the sector is also set to get a boost from the corporate tax reforms recently approved by Congress, as well as the free trade deal signed by the government with some of the Asia-pacific region’s largest economies.
Lopez said manufacturing is showing signs of recovery, pointing to the growth in auto production.
“From hitting zero production in April, it has recorded more than 7,000 units in production as of September,” Lopez said.
He said the same trend could be seen in electrical and electronics exports, which grew 6.3 percent in September after contracting 44.9 percent in April.
“The production indicators from January to November show that while there were significant declines during the first half of the year, we are seeing some recovery in the values and volumes of production indices,” Lopez said.
The Trade chief admitted that Philippine manufacturing suffered a significant blow this year, contracting 11.4 percent in the first 3 quarters of 2020.
This was a sharper decline compared to the rest of the economy which shrank averaged 10 percent during the period.
Lopez however said the CREATE or Corporate Recovery and Tax Incentives for Enterprises bill, which will lower corporate income tax rates, will drive recovery. President Rodrigo Duterte is expected to sign into law soon.
The Philippines’ decision to join the Regional Comprehensive Economic Partnership or RCEP Trade agreement will also boost the sector, he said, as this will open up new markets for Philippine products, tariff-free.
- Report from Warren de Guzman, ABS-CBN News