Electronics industry seen hitting record exports

The Philippine electronics industry is seen to recover lost ground as it is expected to post a record export revenue of $31 billion this year on the back of a sustained strong demand.

“Our target is to grow by 2 to 5 percent for 2016, which will be (equivalent to export revenues of) $30 billion to $31 billion. So there’s a possibility of seeing us hit again the old peak of $31 billion. This will be spurred by new products and new technologies offered by our member companies,” said Dan Lachica, president of the Semiconductor and Electronics Industries in the Philippines Inc.

Speaking on the sidelines of the 13th Philippine Semiconductor and Electronics Convention and Exhibition (PSECE), Lachica said the industry hit a record export receipt of $31 billion export in 2010 before it declined significantly in the following years.

In 2014, the industry’s export revenue stood at only $22 billion while in 2015, it grew dramatically  to about $29 billion.

The growth was attributed to the healthy performances of several key sectors, namely, big data analytics, electronic data processing and automotive electronics.

Another potential source of future growth for the electronics industry, according to Lachica, were research and development (R&D) activities and integrated circuit (IC) design.

“We need to create an ecosystem that is beneficial for R&D. There’s a lot of growth to be gained if we are to create (a conducive) environment R&D because if we have those kinds of activities here, companies will then want to do the pilot production for their designs here as well, near their R&D centers, after which they scale up and mass produce those products here as well,” Lachica said.

As it is, there are already a dozen companies that are engaged in R&D in the Philippines, but SEIPI is eyeing to have more of these types of activities being conducted here.

According to Lachica, one member company of SEIPI has already held a pilot run of its R&D in the Philippines. If this move gains momentum, the company may set up an R&D center in the country.

To encourage more companies to set up  R&D centers in the country, the Philippine government would, however, need to further improve the content of engineering subjects here, and strengthen intellectual property rights protection.

There is also a need to address the requirements for R&D such as availability of graduates that have the skills for this particular job, internet bandwidth, and availability of supply chain.

As for the form semiconductor side, the target now was to move up the value chain and do IC design, Lachica added.