Semiconductor industry needs government boost

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Dan Lachica (center), president of the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI), meets with The Manila Times editors and reporters on Friday to discuss their plans to seek more support from the government to boost exports. PHOTO BY ALEXIS CORPUZ

Dan Lachica (center), president of the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI), meets with The Manila Times editors and reporters on Friday to discuss their plans to seek more support from the government to boost exports. PHOTO BY ALEXIS CORPUZ

The semiconductor and electronics industry may be the country’s biggest export contributor, but the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI) does not see the industry exporting more than $50 billion worth of products by 2016.

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SEIPI has finished drafting the roadmap for the Philippine semiconductors and electronics industry, and projects exports to hit $52 billion employing 14 million people by 2030 if government does not give the sector support.

However, if the government invests in infrastructure and irons out issues to attract more foreign direct investments, SEIPI sees outward shipments of semiconductors and electronics hitting $112 billion by 2030 and directly employing 37 million people.

“If we can get the much-needed support [from the government], we could be as big as a $112-billion export industry with 37 million workers [by 2030]and certainly be very instrumental in inclusive and sustainable growth,” SEIPI President Dan Lachica said in a roundtable discussion with The Manila Times on Friday.

He added that instead of the $50-billion export forecast for 2016 made by President Benigno Aquino 3rd, outward shipments of semiconductors and electronics will likely hit $28 billion by that year if the sector even without state support. With government help, semiconductor and electronic exports will hit $38 billion.

By 2016, the SEIPI forecasts the industry hiring 500,000 direct employees and 3.5 million indirect employees.

Lachica enumerated the four constraints the semiconductor and electronics industry faces today: high cost and low quality power; poor infrastructure; high cost of labor; and government taking away subsidies.

He also pointed out the corruption also causes them to incur “hidden costs.” The industry is also dependent on imports.

Lachica said that the country’s saving grace is its skilled workers, whom he described as productive and disciplined.

The roadmap for the industry, which is expected to be launched by the end of the month, aims to transform the Philippines into a regional center of excellence in selected electronics industry products and processes.

Lachica said the roadmap is finished but is being reviewed by the technical working groups of the Department of Trade and Industry this week.

He added that the Philippine semiconductor and electronics industry will have three growth drivers: consumer products like smart phones and tablet computers; medical equipment; and electronic parts for automotive applications.

Total SEIPI exports in 2012 amounted to $23 billion, a big drop from the $31 billion for 2010.

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