Global manufacturing output drops to 1.2% in Q3 2019 – Report
A report by the United Nations Industrial Development Organisation (UNIDO) reveals that global manufacturing output growth has continued to slow down and currently sits at 1.2 per cent, amid rising tensions over international trade among the major economies.
The report captures the third quarter of 2019 attributes the drop to a production decline in major industrialised economies including Germany, Japan and the United States.
For industrialised countries, manufacturing output fell by 0.7 per cent, compared to the same quarter in the previous year, with the production of general machinery, electrical goods and automobiles the sectors mainly affected.
Similarly, motor vehicles production dropped by 7.7 per cent in Germany, 7.5 per cent in Italy and 4.1 per cent in France.
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Among Asian industrialised economies, manufacturing output dropped in Japan, the Republic of Korea and Singapore.
In Europe, manufacturing growth was much lower in Eurozone economies compared to other European Union (EU) countries.
Among non-EU economies, manufacturing output rose by 3.7 per cent in Belarus, 2.9 per cent in Norway and 2.4 per cent in the Russian Federation.
China maintained relatively higher growth at 5.1 per cent, but it was the lowest growth for several years. China’s manufacturing growth rate has been consistently falling since 2017.
However, China still contributes most of the growth of global manufacturing output.
The report said the impact of the slowdown was quickly spreading to developing economies, noting, for instance, that the manufacturing output of India, one of the largest manufacturers of developing the world plunged to the negative growth for the first time this century due to the decline in exports and weaker domestic demand.
Manufacturing output also dropped in Thailand and Malaysia. The overall growth of Asia and the Pacific region, excluding China has been estimated at less than 1.0 per cent for the third quarter of 2019, compared to 3.0 per cent in the same quarter of the previous year.
After a short-lived recovery, manufacturing output again plunged to negative growth in Latin America, mainly due to production decline in Argentina and Brazil. The growth rate of Mexico and Colombia was less than one per cent.
Manufacturing growth was also sluggish in Africa. The overall growth rate for the continent was 0.6 per cent, the lowest since the fourth quarter of 2017. The manufacturing output of the Republic of South Africa declined by 1.8 per cent.
The global slowdown of manufacturing output posed a serious challenge to achieving Sustainable Development Goal 9 on industrialization, especially for least developed countries (LDCs). This goal aims to double the share of the industry in GDP of LDCs by 2030.
