‘Global manufacturing sustains low growth in Q1’

Despite a 2.8 per cent rise in global manufacturing output, latest report by the United Nations Industrial Development Organization (UNIDO) has shown that world manufacturing sustained low growth during the first quarter of 2015 as a further slowdown in manufacturing output was observed in key emerging industrial economies, especially in China.

For instance, Euro-zone industrialized countries maintained modest growth courtesy an increase in commodity exports prompted by lower energy costs and the depreciation of the Euro against major world currencies.

However, falling oil prices adversely affected manufacturing growth in the Russian Federation, the United States and several other oil-producing countries.

According to UNIDO estimates, the manufacturing output of industrialized countries rose by 1.3 per cent in the first quarter of 2015, lower than 1. 9 per cent growth registered in the previous quarter.

Manufacturing output growth rates declined in industrialized economies of East Asia, namely Japan, the Republic of Korea and Malaysia.

A manufacturing slowdown was also observed in developing and emerging industrial economies, with overall growth in the first quarter of 2015 estimated at 5.3 per cent. Growth in China dropped to 7.2 per cent, the lowest rate in the last decade.

UNIDO estimates indicate negative growth of manufacturing output in major Latin American economies. Manufacturing output fell by 1.5 per cent in Argentina, by 8.0 per cent in Brazil and by 4.2 per cent in Peru.

“By contrast, key developing and emerging economies in Asia improved their growth performance. India’s manufacturing output rose by 3.6 per cent, thanks to improving investment conditions. Among ASEAN countries, a remarkable growth of 5.0 per cent was observed in Indonesia, and of 9.0 per cent in Viet Nam.

“The repercussions of low growth in Europe were apparent in Africa, which relies heavily on exporting to Europe. The manufacturing output of the Africa continent in the first quarter grew by a mere 2.1 percent. In Morocco, it rose by the modest rate of 2.3 percent, in Senegal by 1.3 percent and in South Africa by 0.8 per cent”, the report explained.

The UNIDO report also presents growth figures by industrial sector. Higher growth, both in industrialized and developing economies, was observed in the chemical industry, and in the production of computing machinery and communication equipment. The worldwide production of chemical goods rose by 5.7 per cent and of communication equipment by 7.9 per cent.

“Industrialized countries maintained higher growth in the production of machinery and equipment, communication equipment, and medical and optical instruments.

“Developing and emerging industrial economies maintained higher growth in the manufacture of food and beverages, wearing apparel and leather products. They also outpaced industrialized economies in the production of motor vehicles”, the report added.