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Philippine electronics industry upbeat for 2012

Posted: 27 Jan 2012 ?? ?Print Version ?Bookmark and Share

Keywords:electronics industry? Philippine market? manufacturing sector?

The Philippine electronics sector is seeing a surprising upbeat outlook for 2012, said Trade Secretary Gregory Domingo, referencing a report by the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI).

Domingo added that the bullish outlook supports his own optimistic outlook for 2012 economic growth. After a very disappointing 3.6 percent growth as of the third quarter of last year, Domingo said that the country's growth could even beat the 7.6 percent that was reached in 2010.

According to Ernesto Santiago, president of SEIPI, the industry is hopeful that 2012 will be a better year and that they will be able to post a 10 percent growth in exports from last year.

Last year, the electronics industry faltered due to the global financial crisis in Europe and United States that reduced exports. The great Japan earthquake of March 11 that affected the supply chain also contributed to the weak performance of the industry.

The latest official data show electronics shipments dropping by 22.97 percent to $22.203 billion as of November last year and was mainly due to the slow industrial spending in Europe and the United States.

Santiago also explained that part of the reason why the electronics industry did not perform well last year is because investments in the solar sector did not push through.

Santiago said that consumer spending for electronics is on the rebound. However, corporate consumers are still not spending much on technology, he added. He also admitted that technical spending of firms has not yet recovered.

Santiago mentioned that although electronic products have gotten cheaper, the reduced prices are not enough to pull up demand.

SEIPI sees that the first three months of this year will still be challenging for the industry. But by the second quarter, business will pick up, Santiago said.

Santiago also revealed that there are Japanese firms that have used are their Philippine subsidiaries to produce items that would normally be produced in Japan.

Trade undersecretary Cristino Panlilio commented that registered investments could have topped P1 trillion overall last year. These investments, together with implementation of planned government spending on infrastructure, will ensure that this year and even 2013 will be very busy in terms of job creation, existing jobs, construction activities and assembly activities.

"When we are talking about economic growth, it's not just the numbers... the question is really what kind of growth do we want. [The task] is really inclusive growth... whether it's really the kind of growth that is providing employment... So when we we're looking at the growth this year, I think it will be much better in terms of jobs also," Secretary Domingo said. "We are in the sweet spot right now" with the Philippines fulfilling investor requirements of controlled inflation and interest rate environments and a stable labor situation, Domingo added.

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