Electronics industry remains at 5% growth target despite recovery of foreign economies, high exchange rate

By Kris M. Crismundo

MANILA, March 28 (PNA) — The electronics industry is yet considering adjustment of its export revenue growth target for 2014 despite recovery of foreign economies and higher exchange rate of peso and dollar.

Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI) president Dan Lachica said in a press briefing Friday that the industry remains conservative with the 5.0 percent growth projection in exports revenue for this year.

Lachica acknowledged that the recovery of major economies such as United States, Europe, and Japan among others will back the strong demand in the global electronics industry.

The electronics sector growth for this year will also be supported by positive trends in the segments of automotive electronics, industrial electronics, communication, and the continuous uptrend in commercial electronic products.

Moreover, with the higher peso-dollar exchange rates manifested in the first quarter of this year, Lachica noted that this will be favorable not only in the electronics export but also to the whole export industry of the country.

”The effect of the exchange rate is 5.0 percent of the total. Actually, you saw the effect as part of the January and February performance,” he said.

Based on data of Philippine Statistics Authority (PSA), electronics export kicked-off 2014 with 22.1 percent growth in export revenue to US$ 1.79 billion from US$ 1.47 billion in January 2013.

However, he noted that to further benefit on the depreciation of the Philippine peso, the country should enlarge the small and medium enterprises (SMEs) to establish a stronger local supply chain in order to decrease importing parts from other countries.

According to PSA data, despite the jump in export revenue, electronic products import bill hiked by 11.1 percent to US$ 1.28 billion in January of this year from the same month last year’s value of US$ 1.15 billion.

Finished electronic products ready to be exported by the country have 29 percent components of imported parts, said Lachica.

The SEIPI president reiterated that the industry will remain conservative with its 5.0-percent growth target as the local electronics companies are experiencing some challenges in the country such as reliable power supply and cost, as well as the extended truck ban implemented by the city government of Manila. (PNA)