DESPITE an expected sluggish global market, the Semiconductor and Electronics Industries in the Philippines Inc. (Seipi) has maintained a bullish outlook as it decided to retain its export growth target of 2 to 5 percent this year.
According to Seipi president Dan Lachica, the move was decided by the group during a board meeting last month as recent regional and global developments were not expected to make a significant dent on the electronics sector.
“There’s no compelling reason to change [our export growth targets]. Brexit or Britain’s impending exit from the European Union will not have a major impact,” Lachica said in an interview with the Inquirer.
“We don’t believe that the dispute with China will significantly affect electronics exports—unlike agriculture—to China because electronics demand is practically inelastic due to the transition to a digital economy,” Lachica explained.
Given the current growth targets, the Philippine electronics industry might be able to finally recover lost ground as export revenues were targeted to reach as much as $30.3 billion this year, he added.
Last month, the United Nations-backed Permanent Court of Arbitration in The Hague ruled that China had no historic title over the South China Sea and that it violated the sovereign rights of the Philippines. Effectively, the court upheld the Philippines’ rights in its sea dispute with China.
Earlier in June, 52 percent of Britain’s voting population decided to leave the European Union—a move seen to add uncertainty to the global economy.
Seipi is also retaining its growth targets even as the Export Development Council has already significantly cut its own forecasts.
Late last month, the EDC approved a revised set of export growth targets that would see a more conservative outlook for the country this year and in 2017 to reflect the current volatilities in the global market. For 2016, the growth of merchandise exports is expected to be flat or zero, while that of services is expected at only 9 percent. This would bring the growth of the country’s total exports to only 3 percent for 2016, EDC executive director Senen M. Perlada said in an earlier interview.
For 2017, the outlook for total export growth will also be a conservative 3 percent.
“What will bring the growth in exports is still the electronics sector, which are poised to grow 3 to 5 percent. I think they will be able to hit that growth and that will be significant since electronics account for half of our exports. The chemicals sector is also seen to be strong this year, while some of the agriculture-based exports are expected to recover in the second half. So this means that despite our merchandise exports posting a negative growth of 6.6 percent in the first five months of the year, we still see that there are very good chances that we can at least post a flat growth this year,” Perlada earlier told the Inquirer.