Industries urged to move up the value chain

The Department of Trade and Industry has stressed the need for the local manufacturing sector to “transform and upgrade” so it can move up the value chain amid an increasingly competitive global market.

This may be achieved through innovation, technology upgrade, skills training and developmental investment, according to Trade Undersecretary Ponciano C. Manalo Jr.

Manalo said this was the right time for the manufacturing sector to expand to high value products with the Philippines emerging as the new tiger of the region, making it a preferred investment site.

The DTI official also pointed out that the Philippines recently moved up in the latest IMD World Competitiveness Report to No. 38 in 2013 from No. 43 in 2012.

A total of 60 economies around the world were reviewed for this year’s report, taking into account a country’s economic efficiency, government efficiency, business efficiency and infrastructure.

The electronics/semiconductor industry, for one, stands to benefit from the integration of manufacturing and research and development (R&D), which, according to Manalo, is in line with the DTI’s roadmap for the said sector.

A recently concluded electronics trade show highlighted the strong capacity of the Philippine electronics industry not only in assembly and test, but also in the areas of engineering design and R&D.

The local electronics industry is export-oriented but it presently relies heavily on imports. Last year, the total industry imports amounted to $17 billion.

This could be a value-added opportunity for the country, if only parts and materials for electronics manufacturing were locally available, the Semiconductor and Electronics Industries in the Philippines Inc. (Seipi) said.

Manalo noted that the DTI and Seipi were revisiting the electronics roadmap in order to set clearer directions and come up with concrete projects for the industry from 2016 and beyond.

The industry group announced that it would retain its forecast of a 5-6 percent growth in electronics exports, from the $23 billion posted in 2012, despite a slump in the first quarter of 2013.

Growth is seen to come from the expected increase in demand for tablets and smart phones, consumer appliances and automotive parts—the components for which are being manufactured in the country.