By means of Justine Irish D. Table, Reporter
PHILIPPINE EXPORTS OF semiconductor and electronic products are likely to remain flat through 2025 due to a drop in demand Semiconductor and electronics Industries in the Philippines Foundation, Inc. (SEIPI) said.
SEIPI President Danilo C. LaChica said the board confirmed its previous projection of a 10% decline in semiconductor and electronics exports this year.
“We just completed our board meeting last week. The forecast of a 10% contraction for 2024 is the same, while exports remain flat in 2025,” he said in a Viber message on Monday.
Mr Lachica said exports were likely to be flat in 2025 as the semiconductor and electronics industries were hit by a “difficult economic situation”. environment and low demand.”
Exports of electronic products accounted for 55% of the total Philippine exports of US$55.67 billion. Period from January to September.
In the first nine months, the Philippines exported US$30.6 billion worth of electronic products, down 2.2% from US$31.28 billion a year ago, amid weak demand.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said seeking comment that newly-elected U.S. President Donald J. Trump’s expected protectionist policies and trade wars could impact Philippine exports, including electronic products.
“Trump’s protectionist policies could lead to higher tariffs, and trade wars could slow global trade and global economic and business activity,” Ricafort said in a Viber message.
In a Nov. 25 report, GlobalSource country analysts Diwa C. Guinigundo and Wilhelmina C. Mañalac said Mr. Trump’s plan to impose 60% tariffs on Chinese goods and up to 20% tariffs on goods from other countries could hurt the economy harm. Exports from the Philippines to the US.
“The US is a major destination for Philippine exports, accounting for an average of about 16% of total export trade over the past five years,” the analysts said.
“While the share overall has declined slightly due to the Philippine government’s trade diversification policies in recent years, a further decline in exports to the US definitely does not bode well for the country,” she added.
Earlier, Mr Lachica said the country will need more investment to improve its export mix make it more competitive globally.
“One of the comments I heard when we were in the US is that the Philippines has fallen asleep in terms of the semiconductor and electronics industries, referring to the previous administrations,” he said in a panel discussion during National Exporters Week on December. 4.
“In fact, we have significant capital flights from the electronics industry due to the rationalization of incentives,” he added.
Mr Lachica said the “good news” is that the Marcos administration is solving the stimulus rationalization problems through business recovery and tax incentives for companies to maximize opportunities for revitalizing the economy ( CREATE MORE).
Mr. Marcos last month signed Republic Act No. 12066 or CREATE MORE Act, which aims to improve the country’s fiscal stimulus policy.
The CREATE MORE Act extended the maximum duration of use of tax incentives from 17 years to 27 years, and lowered corporate taxes for registered businesses.
Mr. Lachica said he recognized the government’s efforts to reduce the cost of energy and logistics through the Luzon Economic Corridor.
The Luzon Economic Corridor is established through a trilateral agreement between the Philippines, the US and Japan. It is part of a broader collaboration supported by the G7 Partnership for Global Infrastructure and Investment.
“So we are very optimistic, at least from an industry perspective, to announce that the Philippines is back,” he said. “Of course there are a number of other issues that we have to take into account. But the ease of doing business has improved, the infrastructure is improving and the power supply is improving, so I think this is really a call to action [for our partners] to rethink the Philippines.”