Manufacturing sector regains growth momentum

ABO/NDO – Vietnam’s manufacturing growth picks up in April following sharp rises in new orders and output.

Vietnam’s manufacturing growth picks up in April following sharp rises in new orders and output. (Photo: VNA)

According to Nikkei’s report released on May 2, the Purchasing Managers’ Index (PMI) of the sector rose to 52.7 points in April, from 51.6 points in March. The production sector has become stronger in the past 29 months.

Substantial increases in customers’ demand and foreign orders made manufacturing rise at faster pace. Also, employment growth has been registered for 25 consecutive months.

However, domestic producers said that a dramatic hike in input costs made a startling contrast to the weak pace of rise in output prices.

Andrew Harker, Associate Dierctor at IHS Markit which compiles the survey said that the Vietnamese manufacturers’ ability to maintain the large volume of orders is a striking point in the latest PMI report, with new export business up significantly in April.

The competitive pricing is the prime motive for the success of a company as it explains the firm’s willingness to reduced margins in exchange for securing greater volumes of new work, he added.

The PMI survey for the manufacturing sector is based on questionnaire responses from panels of senior purchasing executives at over 400 companies majoring in eight fields of metal, chemical and plastic, electronics and optics, food and beverage, engineering, garments, wood and paper, and transportation.

The surveys have been conducted in more than 40 countries and also in key regions. They are the most closely-watch business surveys in the world, favoured by central banks, financial markets and business decision makers for their ability to provide up-to-date, accurate and often unique monthly indicators of economic trends.

(Source: NDO)