Wireless technology to drive growth of RP electronics sector

Rising demand for wireless communications devices, notebook computers, and a variety of products that enable Internet connectivity will most likely drive the growth of the electronics industry in the Philippines, according to Arthur Tan, president of the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI).

"This trend favors Philippine-based semiconductor companies producing digital signal processors or DSPs and analog integrated circuits (IC), storage device and mobile handset, original equipment manufacturers (OEMs), and electronics manufacturing service (EMS) providers catering to these segments," he pointed out.

Global sales of DSPs are projected to grow at a compounded annual growth rate of over 16 percent until 2009 due to the continued increase in demand for mobile phones.

"For Philippine-based companies, there are plenty of outsourcing opportunities from OEMs in the automotive, medical, and industrial electronics segments," Tan stressed.

Electronics make up the bulk of Philippine exports. In 2005, Philippine electronics exports reached $27 billion.

The Philippines produces 100 percent of Nokia’s DSPs and 80 percent of Siemen’s and Ericsson’s under Texas Instruments, which has been based in the Philippines for three decades.

The Philippines also supplies 50 percent of the world’s requirements for hard disk drives from top three global suppliers: Fujitsu, Toshiba, and Hitachi.

Most electronics buyers are now reportedly adopting a ‘China plus’ strategy instead of relying heavily on China for its electronics requirements, with countries like the Philippines standing to benefit.

Large multinational and semiconductor companies and homegrown EMS providers have served global demand for many years. Every year, the country produces 72 million magnetic heads, 36 million DSPs, 30 million hard disk drives or HDDS, 11 million liquid crystal display units (LCDs), and eight million optical disk drives (ODDs).

Some of the global electronics companies in the Philippines are Intel, Texas Instruments, and Philips. Three of the largest HDD producers in the Philippines are Hitachi, Fujitsu, and Toshiba.

"Developing our competency is the top priority of the industry. We aim to upgrade the skills of Filipino engineers to meet the industry’s requirements, and elevate the industry to higher value activities to retain and attract investments," said Tan.

Together with the government and the academe, SEIPI established the Advanced Research and Competency Development Institute to provide training and competency development support for the industry.

SEIPI has identified seven key program for the country’s electronics and semiconductors industry for 2006-2007.