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RP electronics posts $32.7-B export in ’17

The country’s electronics sector posted a record export revenue of over $32 billion in 2017, regaining its strength after the market slowed down in the past six years.
Semiconductor and Electronics Industries of the Philippines Foundation Inc. (SEIPI) reported that electronics export revenues surged by 11 percent to $32.7 billion last year from $29.4 billion revenues in 2016.
In a briefing yesterday, SEIPI president Dan Lachica said the sector went back to the $30-billion export value level after the market declined in 2011 until 2016.
Lachica said the country posted the $30-billion level export revenues for electronic goods in 2007 and 2010.
Semiconductor still shared the highest exports at $23.74 billion last year, growing by 12.17 percent from 2016’s revenue of $21.16 billion.
Exports of electronic goods, such as electronic data processing, office equipment, consumer electronics, communication/radar, and control and instrumentation, registered positive growth in 2017, while revenues of telecommunication electronics, medical/industrial instrumentation and automotive electronics declined in the previous year.
Despite the robust growth in 2017, the industry set this year’s target exports expansion at conservative growth of six percent, following the lower-end of the global electronics market growth forecast of six to eight percent for 2018.
Lachica said the six-percent growth this year is also realistic coming from a bigger base in 2017.
To further strengthen the growth of the electronics sector, SEIPI is launching this year its industry roadmap called Product and Technology Holistic Strategy (PATHS).
PATHS aims to diversify the country’s electronics exports from manufactured electronic goods to service-oriented electronics exports, such as integrated circuits design and research and development.
With the new roadmap, the industry targets revenues of $40 billion and $50 billion in 2025 and 2030, respectively.
To support the revenue goals, SEIPI aims for the country to attract additional investments of $1.5 billion to the industry by 2020, $3 billion in 2025, and $5 billion in 2030.
Lachica estimated the industry had less than $1 billion new investments last year.
“The key is bringing in new technology,” he said.
Lachica said the country needs to attract investments in integrated circuit or IC design center, lab-scale wafer fabrication, and research and development laboratory.
“We proposed that we expand our IC design activities here. So, we wanted a technology center whether it is housed at SEIPI, or DTI (Department of Trade and Industry), or DOST (Department of Science and Technology), or any other private entity to come up with a design center. In a way, (this) increases the opportunity for design startups, students to access IC design,” Lachica said.
He said the country had only about four or five IC design companies, compared to Taiwan with some 1,000 design companies, some of which employ Filipino engineers.
As the industry prepares for the infrastructure and technology, Lachica said it was also necessary for the academe to align the skills of the country’s pool of talent to the needs of the industry by improving the engineering curriculum.
Moreover, to produce the prototypes of the IC design, a wafer fabrication was needed, he said.
SEIPI, under the PATHS, is eyeing for a laboratory-scale wafer fabrication in the country.
But a wafer fabrication demands large investments, with at least a billion dollars for a commercial facility.
Currently, electronics firms here are sending their IC design abroad for the output. Most of the wafer fabrication facilities are only present in developed countries.
To attract wafer fabrication investments here, Lachica said there was also a need to resolve power cost and quality.
Further, a research and development laboratory focusing on electronic goods is also necessary to support the growth of the industry.
Lachica noted the lack of these facilities holds back the industry to produce new products like manufacturing of 3D printers and smartphones, although multinational smartphone makers are outsourcing their components from the Philippines.
The industry group also urges multinational companies to increase the share of local content in their facilities.
For instance, Semiconductor Philippines, Inc. president and general manager Sunil Banwari said the company’s facilities in Cavite and Tarlac improved their local sourcing to 46 percent in 2016 from 62 percent in 2015.

1 comment

  • Erick Homicillada

    i have worked in the semi conductor business for over 30 years from 1978 to 2006 and still hopeful that a wafer fab facility can be set up here in the Philippines. The investment
    capital to do this is US 1 B todate, during our time it is less than that but no multi national company base in the Philippines opted to pursue the dream of WAFER FAB facility in this part of the globe. So unfortunate, because we have the technical personnel and knowledge since many of our engineers were trained and employed by companies engaged in the WAFER FAB during our time.

    Erick Homicillada Thursday, 15 February 2018 09:14 Comment Link

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