TTHE government is pinning its hopes on smartphone manufacturing companies considering the Philippines as assembler for their products, given its “strength” in semiconductor and electronics, a Department of Trade and Industry (DTI) official said.
“… I think Apple is venturing with Vietnam already for the assembly of iPhone products, so again we hope that…other companies into smartphone manufacturing . . . can consider the Philippines because of our strength in electronics and semiconductor industry,” DTI Assistant Secretary for International Trade Policy and Trade Negotiation Allan B. Gepty said.
If the Philippines wants to position itself as a manufacturing hub, one area it should look at are high-value technology products, he added.
“High-value technology products in the sense that given that we already have a very strong semiconductor industry and electronic industry, why not attract companies to manufacture or at least assemble final products here in the Philippines?” Gepty told the recent Policy and Advocacy Committee Meeting hosted by the German-Philippine Chamber of Commerce and Industry (GPCCI).
Philippine Statistics Authority (PSA) data showed the local semiconductor and electronics industry retained its position as the country’s top commodity exporter.
In 2022, it accounted for US$49.09 billion, a 6.88-percent annual growth from 2021. According to the Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI), this was 62.27 percent of the US$78.84-billion total Philippine commodity exports.
Aside from projecting itself as a manufacturing hub for high-value technology products, the Philippines can also engage in research and development for the said type of products, Gepty said.
“Computers, I mean we do not have an assembly on final products of computers or even cameras or smartphones. So, since all of the materials basically are here, why not enter into that?” the Trade official stressed.
According to the SEIPI website, as of January 2023, Hong Kong ranks first among the countries of destination for Philippine electronics exports, accounting for 14.45 percent. The USA ranks second with 12.47 percent share and China ranks third with 11.78 percent.
The other destinations in the top 10 and their shares: Germany, 5.90 percent; Taiwan, 5.15 percent; Vietnam with 3.91 percent; Thailand with 3.82 percent; and South Korea with 3.63 percent.
Meanwhile, a Bloomberg report published in March 2023 said Apple Inc. partner Foxconn Technology Group plans to invest about $700 million on a new plant in India to ramp up local production.
“The Taiwanese company, also known for its flagship unit Hon Hai Precision Industry Co., plans to build the plant to make iPhone parts on a 300-acre site close to the airport in Bengaluru, the capital of the southern Indian state of Karnataka, according to the people, who asked not to be named as the information is not public,” the Bloomberg report said.
As for the US tech giant’s plan to set up a hub in Vietnam, a Bloomberg report on February 28, 2023 quoted Deputy Chairman Kazuyoshi Yoshinaga telling a Bloomberg interviewer that “AirPods maker GoerTek is investing an initial $280 million in a new Vietnam plant while considering an India expansion.”
Bloomberg said GoerTek is “one of the many manufacturers exploring locations beyond its native China, which today cranks out the bulk of the world’s gadgets from iPhones to PlayStations.”
AirPods is the wireless bluetooth earbuds designed by Apple Inc.
The Bloomberg report pointed out that the conflict between the US and China began with a trade war, but has since expanded to “encompass sweeping bans on the exchange of chips and capital, is spurring a rethink of the electronics industry’s decades-old supply chain.”
Meanwhile, according to a Nikkei Asia report published in December 2022, the US tech giant plans to move some MacBook production to Vietnam for the first time in 2023 as Apple “continues diversifying its production base away from China amid escalating tech tensions between Washington and Beijing.”