For the past two decades, the Philippine manufacturing sector has failed to generate sustained growth and employment for the economy. This can be attributed to the stagnation of the sector due to its inability to generate foreign direct investments and to the absence of structural transformation from agriculture to manufacturing. This Policy Notes argues for the development of a new industrial policy to help the government in crafting relevant measures that can enhance productivity growth in the manufacturing sector, deepen the linkages of domestic firms and small and medium enterprises with large domestic and multinational companies, and attract more investments. Such a policy is crucial in building a strong and modern industrial sector which can facilitate sustained and high growth levels for the country.
