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HomeWorld NewsIndustry group expects electronics exports growth to slow to 5% this year

Industry group expects electronics exports growth to slow to 5% this year


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THE SEMICONDUCTOR and Electronics Industries in the Philippines Foundation, Inc. (SEIPI) set a 5% exports growth target this year, as it expects demand to weaken amid a potential global recession.

The industry missed its 10% growth goal in 2022, as the value of electronics exports jumped by 6.88% year on year to $49.09 billion.

SEIPI President Danilo C. Lachica said in a Viber message that last year’s revenues hit a “record high,” even as it failed to hit the target.

“(We have set) 5% (lower target) for 2023 due to slower global demand. (The growth will be) driven by automotive and industrial electronics products,” Mr. Lachica said, adding the new target was set during a SEIPI board meeting last week.

In January, Mr. Lachica had said SEIPI was eyeing a 9% growth this year.

Meanwhile, SEIPI raised several issues, namely the low foreign direct investments in the electronics industry, high operating costs, and work-from-home (WFH) arrangements, with the officials of the Trade and Finance departments as well as the Philippine Economic Zone Authority (PEZA) and the Bureau of Customs (BoC).

Mr. Lachica previously urged the government to allow exporters and manufacturers to conduct WFH arrangements, particularly for employees not involved in production.   

The proposal came after the government allowed registered information technology and business process management firms to implement 100% WFH and avail of fiscal incentives as long as they transfer their registration to the Board of Investments from the PEZA.   

Mr. Lachica also expressed concern over the BoC’s X-Ray Selectivity System and the implementation of the electronic tracking of containerized cargo system, saying it was unnecessary and entailed more costs for the industry.

SEIPI also raised the issue of the Bureau of Internal Revenue’s imposition of a 12% value-added tax on constructive exporters and production support functions.   

Meanwhile, SEIPI said it is eyeing to locally source more materials used in production such as chemicals, plastics, and packaging materials. This after it successfully localized P321.3 million worth of imported parts and materials in 2022.

“The Parts Localization TWG (technical working group) has tapped more local suppliers and manufacturers to enhance their capacities to supply critical materials for the electronics member companies… The TWG targets to locally source more items this year, focusing on chemicals, plastics, and packaging materials,” it said.

There are plans to expand the parts localization program to the Visayas and Mindanao regions, it added. — R.M.D.Ochave

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