Eectronics exports will suffer the adverse impact of an economic downturn up to the first half of 2009 but are expected to be strong in the long term, the head of the Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI) said.

Electronics exporters will see flat growth in 2008, with the next two quarters expected to remain soft, SEIPI chairman Arthur Young said.

This month, electronics exports have gone down 1.5-2.0 percent so far from the level in September because of the global economic pinch, Young said in an interview.

“But that’s actually not bad, given the overall market scenario,” he said. “Visibility is very poor right now. We don’t see strength of demand. It’ll be a rough market in the next few months.”

But he said “by the first half of 2009, demand should be able to pick up.”

“Of course, we’re concerned about what will happen in the short term, but we believe the market is still healthy [for] the long term,” Young said. “By the second half of next year, if the credit market stabilizes, things will get better.”

Areas for growth included the markets for cell phones, laptops and personal computers, Young said.

A lot of opportunities are also in automotive electronics, with more and more manufacturers coming out with hybrid cars, he added.

Although most investors were taking a wait-and-see stance in light of what is happening in the United States, the Philippines can attract new investments by capitalizing on its Asian neighbors’ shortfalls, Young said.

He said labor costs in China had started to go up and Beijing had begun to cut down on incentives for investors to cool the Chinese economy.

Vietnam has also been giving foreign investors some problems because of inadequate infrastructure and manpower, plus high inflation, he added.

“In the Philippines, the workforce is more stable and there are fewer uncertainties here,” Young said. “Maybe we won’t see any new investments in the short term, but now is the time for pitching and positioning. We need to do ‘focused pitching’ to companies that we can serve best. There are a lot of opportunities for us when the market comes around.” Edited by INQUIRER.net