Electronics exports growth seen flat this year – SEIPI

MANILA, Philippines — The Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI) now foresees a flat growth in electronics exports for the year, aiming to recuperate from a decline in the first half.

“The last quarter or so, we’ve been clobbered in terms of our electronics exports. In fact, at one point, we were 15 percent down compared to last year,” SEIPI president Dan Lachica said.

Latest figures from SEIPI showed that electronics exports fell by 6.99 percent to $21.19 billion from January to June from $22.78 billion in the same period last year.
The decline was driven by the 70.44 percent decrease in automotive electronics exports to $18.70 million.

Lachica, however, noted that there have been signs of recovery as the decline had narrowed as of June.

“As of June we’re seven percent down and we have, however, revised our growth forecast from five percent for the year to flat, zero, because realistically we’re down at seven percent,” Lachica said.

“But we see a recovery in the third and fourth quarter. So that’s why we’re aiming for at least flat (growth),” Lachica said.

He cited the geopolitical conflicts and the US trade war as some of the reasons for the decline in electronics exports in the first half.

“But the demand is still there. And so we’re hoping that the thanksgiving demand, the Christmas demand will propel the recovery of the industry,” Lachica said.

“We’ve seen an interesting reversal in Europe. Used to be Germany was our highest EU destination and then Netherlands. Now it switched. In Europe, the biggest destination is now Netherlands followed by Germany,” he said.

In May, Lachica expressed difficulty in achieving $53.7 billion in electronics exports under the new export development roadmap, citing global economic and geopolitical issues.

Lachica said that under the Philippine Export Development Plan (PEDP) 2023-2028, the country hopes to grow electronics exports to $106 billion by 2028, accounting for 40 percent of the country’s total exports.

“But the thing is, we’re facing a major handicap even in 2023 because the projection is $53 billion. That target may be at risk for 2023,” Lachica said in May.

The $53.4 billion target for this year under the PEDP is 9.4 percent higher than the $49.09 billion exports registered last year.

“Hopefully we take some action, discuss what we could take to get back with that plan. I’m hoping again for proactive government conversations with them that would help them understand what the issues are,” Lachica said.

Under the PEDP, the country’s electronics and electrical exports are targeted to grow to $61.1 billion in 2024, $70 billion in 2025, $80.3 billion in 2026, $92.4 billion in 2027 and $106.4 billion in 2028.