The manufacturing sector of ASEAN concluded a robust performance in 2024, characterized by moderate growth in orders and output levels, all while navigating mild inflationary pressures. The S&P Global report emphasizes that the ASEAN manufacturing purchasing managers index (PMI) registered at 50.7 in December, marking a slight dip from November's figure of 50.8.
However, this remains above the critical 50 threshold that distinguishes growth from contraction. Throughout 2024, it has been noted that the ASEAN factory sector consistently operated within 'expansion territory' each month since January. This stability is vital for the continuous development of the economies involved.
The nations surveyed by S&P Global include Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. The December PMI saw enhancements attributed to increased 'new orders and output'. This notable growth marked the tenth consecutive month of upward movement, with the most recent rise being the strongest observed this quarter.
Inflationary pressures exhibited a cooling effect during this period, aiding overall economic stability. Despite a generally favorable environment in terms of order growth, the global export markets painted a less optimistic picture. There was a noted decline in new export orders, extending the current contraction phase to a staggering 31 months.
Such trends raise concerns on the overarching health of the sector's international competitiveness. In terms of employment, ASEAN factory managers exercised caution regarding payroll expansions in December. Staffing levels experienced marginal cutbacks for the second month in a row. This restraint occurs despite indications of growing pressures on production capacity, as backlogs of work rose for the tenth consecutive month. Looking forward to 2025, factory managers within the ASEAN region displayed a degree of optimism regarding production schedules; however, the ongoing softness in export orders remains a significant point of consideration.
While the outlook for 2025 remains broadly positive, the growth potential in new orders is anticipated to be modest and heavily reliant on the dynamics of domestic demand. The December PMI figures were compiled by S&P Global based on survey responses from a total of 2,100 manufacturers operating across the ASEAN nations, with data collection occurring from December 5 through December 17..