Electronics industry expected to rebound

MANILA, Philippines – After a brutal decline since the fourth quarter of 2008, the country’s top export, electronics is seen by its leaders to bounce back to a modest growth this year.

The projection was made by Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI) president Ernie Santiago during the group’s recent general membership meeting.

Santiago said the whole industry, that makes up more than half of the annual export earnings of the country, will reflect a modest growth this year in anticipation of the improving global economy.

The recovery was seen on the heels of a dramatic rebound in the last quarter of last year when the retreat slowed down to single digit in October, was back to double-digit growth in November and posted a hefty 40.9 percent growth last December over the same month in 2008.

Tracking the month-on-month performance of the multi-billion dollar industry, Santiago noted that the lowest ebb came in December 2008 and January 2009 when monthly export sales dipped to their lowest at $1.3 billion a month.

Electronics products resumed sequential growth, month-on-month in the second quarter of the year, but the situation remained bad until the third quarter of the year.

The industry started regaining lost grounds since last February and was back on track in December. The double-digit retreat in the first nine months of last year however resulted to export revenue losses of about $8.08 billion, as revenues for 2009 reached $38.32 billion, much lower than the $46.40 billion earned in the same period in 2008.

Investments in 2009 were likewise lower at $235 million compared to $395 million sunk into expansion in 2008. The industry, known to have heavy investments as the main driver of its spectacular growth in the 1990s, generated 8,224 jobs during its worst year. In a capital-intensive industry, Santiago estimated that one job is created by every P1 million in investments.

SEIPI, he said, with its board members and networking committees, in partnership with government, will continue its drive to make a conducive environment for electronics business to grow in the Philippines.

In December last year, electronics was joined by copper concentrates, petroleum, ignition wiring sets and metal components among those that posted double-digit growth while cathodes, garments and furniture languished in the negative growth list.

On an annual basis, only pineapples, gold, activated carbon, raw tobacco, fine jewelry and sugar remained in the growth path in the midst of what was seen as the worst crisis that hit the export sector in more than a decade. – Philexport News and Features