Electronics sector gives up 5% export growth target

Published April 20, 2020, 12:00 AM

by manilabulletin_admin

By Bernie Cahiles-Magkilat

The 5.0 percent export growth forecast of the electronics sector this year will mostly likely be missed, according to the Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI).

Semiconductor and Electronics Industries Foundation, Inc. logo (Courtesy of seipi.org.ph)
Semiconductor and Electronics Industries Foundation, Inc. logo (Courtesy of seipi.org.ph)

SEIPI President Dan Lachica said only 30 percent of its members are operating and are slowly moving up to 50 percent. There are over 100 electronics manufacturers in the country but only 350 are SEIPI members. The industry employs 400,000 workers.

Our 5 percent growth forecast over 2019 $43.3 billion will most likely be missed,” he said.

Lachica, however, said it is difficult to forecast the outlook of the industry. He could not also say for certain as to how long companies can afford to pay their workers even without no operation.

“Depends if the ECQ is further ex¬tended or modified. If modified, will manufacturers be allowed to ramp up production level. We will have to wait and see,” he said.

Meantime, there are order backlogs as companies are on limited operation. There are also challenges on the deliveries of raw materials and staffing for normal operations.

The domestic electronics manufacturing industry, which accounts for 60 percent of the country’s total exports. Over 30 percent of our imported materials come from China and Hong Kong.

The industry’s top imports include communication/radar, components/semiconductor devices, control and instrumentation, telecommunication, electronic data processing, office equipment, automotive electronics, medical/ industrial instrumentation, and consumer electronics.

The Philippine semiconductor and electronics industry is a significant driver of the Philippine economy and the largest contributor to the country’s manufacturing sector.

Last year, the industry’s exports grew by 4 percent ending the year with $43.3 billion despite the raging US-China trade war.

Top export markets for the country’s electronics products are Hong Kong, US, China, Singapore and Japan. Majority are semiconductor components/devices, consumer electronics, control and instrumentation, electronic data processing, telecommunication, among others.

The Philippine Electronics Industry is classified into 73 percent semiconductor manufacturing services (SMS) and 27 percent electronics manufacturing services (EMS). Most of the electronics businesses in the country operate in four key areas: Metro Manila, CALABARZON, Northern/Central Luzon and Cebu.

Electronic companies in the country practice the best known methods in manufacturing with capabilities ranging from IC packaging, PCB assembly and full product assembly.