In the recently concluded session of the Weekly with JC series, titled “Circuit Breakers: Trends Shaping the Semiconductor & Electronics Industry,” Dan Lachica provided key insights into the challenges and opportunities shaping the semiconductor and electronics industry. With the Philippines’ semiconductor and electronics sector being the largest export contributor at $42.6 billion in 2024, the discussion focused on strategies to navigate economic headwinds, investment incentives, and workforce development.
Industry Performance and Challenges
The semiconductor industry in the Philippines has experienced two consecutive years of decline, dropping from its 2022 peak of $50 billion. Factors contributing to this downturn include global inventory corrections, evolving investment policies, and geopolitical uncertainties. The loss of major investments, such as a $1.6 billion semiconductor project redirected to Vietnam, underscored the urgency of creating a more investor-friendly environment.
Investment Climate and Policy Adjustments
A major point of discussion was the impact of the CREATE law and the government’s efforts to refine incentives through the CREATE MORE initiative. Industry leaders emphasized the need for a stable and competitive investment framework to attract multinational firms. Policymakers assured participants that measures are being taken to address regulatory bottlenecks and enhance the ease of doing business.
Strengthening the Supply Chain
The session highlighted the Philippines’ reliance on imported semiconductor wafers, with 70% sourced from Taiwan. Given geopolitical risks and supply chain vulnerabilities, there is a strong push to establish a local wafer fabrication facility. A pilot lab-scale wafer fab, supported by the Department of Science and Technology (DOST) and potential funding from the Asian Development Bank (ADB), is being explored as a stepping stone toward greater self-sufficiency.
Workforce Development and Industry-Academia Collaboration
Ensuring a steady pipeline of skilled talent remains a top priority. Industry leaders called for stronger partnerships with academic institutions to align curricula with industry needs. SEIPI, through its PHASE program—Training, Research and Development, Advocacy, Information, Networking, and Services—continues to spearhead initiatives aimed at upskilling workers and fostering innovation.
Future Outlook and Action Plan
The session concluded with a commitment to collaborative efforts between industry stakeholders and the government. Key action points included refining investment policies, addressing supply chain vulnerabilities, and enhancing workforce capabilities. By implementing these strategies, the Philippines aims to solidify its position in the global semiconductor landscape and drive long-term growth in the electronics sector.
Stay Ahead in the Philippines Semiconductor Industry
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