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PH electronics to lose due to Japan disasters

/ 06:42 PM March 15, 2011

MANILA, Philippines—The massive earthquake in Japan, which triggered a tsunami and pushed the country on the brink of a nuclear disaster, will adversely affect the Philippine electronics industry as railway systems and cargo planes carrying raw materials from Japan cease to operate.

According to Ernesto Santiago, president of the Semiconductor and Electronics Industries of the Philippines Inc., railway systems servicing northeastern Japan and Tokyo had temporarily stopped operations. Cargo planes had also stopped accepting shipments due to heavy backlogs and damage to their warehouses.

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Should this situation continue, locally based Japanese firms as well as Philippine manufacturers would have no raw materials to process, Santiago said.

“The major impact on Japan’s semiconductor production is … disruption to the supply chain. Suppliers are likely to encounter difficulties in getting raw materials … distributed, and shipping products out,” Santiago said in a statement issued on Tuesday.

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“A prolonged abnormality in Japan will certainly affect material supplies in the Philippine electronics industry,” he added.

Around 18 percent of Seipi’s total members are Japanese firms. In 2010, these companies accounted for 20 percent of the Philippines’ total exports.

Meanwhile, the local automotive industry has yet to assess the impact of the earthquake on their supply.

Elizabeth Lee, president of the Chamber of Automotive Manufacturers of the Philippines Inc., said it has been mostly business as usual here for Japanese automobile makers.

“Note that the majority of vehicles sold in the market are sourced within the Asean (the Association of Southeast Asian Nations), although some are sourced from Japan. Some high-volume Japanese brands are locally assembled so, for those products, it’s business as usual. We have yet to fully assess the impact, if any,” Lee said.

In her own company, Universal Motors Corp., Lee said no supply shortage was expected.

Rommel Gutierrez, first vice president of the Toyota Motor Philippines Corp. for vehicle operations, said in a separate interview that the company was still checking with its parent firm in Japan whether or not there would be any local supply disruption.

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“We are still checking. There’s no official report yet. Our supply comes mostly from the Asean,” he said on Tuesday.

Toyota also manufactures its popular Vios and Innova models at its manufacturing facility in Sta. Rosa, Laguna.

In the area of agricultural products, Agriculture Assistant Secretary Salvador Salacup said trade between the Philippines and Japan would continue.

“We’re studying the situation very closely. We’re talking with our trade attaché there. Our exports to Japan will still continue, but if ever there will be a slowdown, we’ll link exporters up to other markets in the region, like China and South Korea,” he said.

The country exported more than $400 million worth of agricultural products to Japan, including banana, pineapple, tuna, mango, seaweeds, asparagus, and okra, he said. Imports, on the other hand, amounted to $105 million and were made up mostly of mackerel.

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TAGS: Business, Disaster, Earthquake, Export
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