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Chairpersons

Semiconductor and Electronics Industries Continue to Grow Despite Negative Reports

Strategic Insights

— 2 min read

Despite recent negative reports, the semiconductor and electronics industries in the Philippines have continued to grow and deserve support from the government, according to the executive committee of the semi-government Export Development Council (EDC). The misinformation reported by some sources misrepresents the industry's performance and projects a wrong message to the public. The industry's growth has been faster than the global average, with a 7.47 percent growth in total sales from January to September 2005.

Key Takeaways:

  • The semiconductor industry has posted a 7.47 percent growth in total sales from $15.203 billion in the same period last year to $16.339 billion in the first nine months of 2005.
  • The electronics industry showed a decline of 12.98 percent in exports compared to the same period last year, mainly due to the pullout of Toshiba Corp. in January 2005.
  • Export revenues for the nine-month period this year totaled $5.9 billion compared to $6.78 billion in the same period last year.
  • The industry is expected to recover in the coming year with the investment of $40 million by Winston Infocom to expand its manufacturing facilities in the Philippines and expected huge orders from China.
  • Semiconductor and electronics exports make up about 70 percent of total Philippine exports.
  • Industry players have expressed concern that the government may discontinue its support to proven export winners, despite its importance to the economy.

Statistics:

  • The semiconductor industry's growth has been faster than the global average sales growth of 6.13 percent for the first nine months of 2005.
  • Toshiba Corp.'s relocation resulted in a loss of close to $1 billion a year in revenue.
  • The electronics industry's decline in exports was due to the loss of Toshiba's contribution of 1.8 million laptop units valued at $500 per unit to the Philippine economy.
  • The Philippine government must support the electronics industry, which makes up 70 percent of total Philippine exports.
  • Export development, promotion, and marketing support from the government must be expanded across all products to adopt exporting as a national development strategy.

Sources:

  • "Semi-government council denies downgrade of export performance" by Thomas G. Aquino, Acting Chairman and Trade Senior Undersecretary, Export Development Council (EDC)
  • "Don't abandon our semiconductor industry" by Ernesto Santiago, Executive Director, Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI)
  • "Support for sector seen to ensure growth" by Sergio R. Ortiz-Luis, Jr., President, Philippine Exporters Confederation, Inc. (PHILEXPORT)

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