With a gross domestic product (GDP) of 6.4%, the Philippines is estimated to grow and become the 16th largest economy by 2050. Its manufacturing industry accounts for 23.3% of the GDP. Exports have also been one of the primary revenue drivers for the Philippines, with the electronics manufacturing services (EMS) and semiconductor manufacturing (SMS) accounting for around 51% of the export revenues. With a population of over 104 million and a high literacy rate, the Philippines has been the location of choice for most regional countries for making electronics manufacturing–related investments. According to the International Monetary Fund (IMF), of Philippine exports, two-thirds go to other Asian countries, one-sixth go to North America, and the rest go to Europe and Africa. The downturn in U.S.-related exports owing to unstable bilateral relations is projected to be offset by the increase in demand for smart ecosystem and connected lifestyle–driven technology investments in Europe and the rest of Asia/Pacific. The Philippine government is also expecting advanced driver-assistance systems (ADAS) and respective Smart City initiatives to lead to over a 5% increase in exports.
Although the hi-tech sector has been a major contributor to the Philippine manufacturing industry, there are still quite a few challenges, such as lack of skilled labor, insufficient research and development (R&D), and infrastructure deficiencies. These have been adversely affecting the growth of the sector. The Philippine government has launched initiatives and formed several industry alliances to mitigate these challenges. This presentation talks in detail about such initiatives, along with the existing challenges, opportunities, and recommendations for OEMs, and the need to pursue a growth model hinging on R&D.
"Organizations have realized the importance of moving up the electronics value chain and are increasingly looking at forming business strategies in which innovation, codevelopment of suppliers, and industry alliances are integral parts of the manufacturing operations," says Sampath Kumar Venkataswamy, research manager, IDC Manufacturing Insights, Asia/Pacific.
EMS Components Assembly, Inc., Fastech Synergy Philipines Inc., TDK Corporation, SUMITRONICS CORPORATION, IONICS EMS INC., CIRTEK ELECTRONICS CORP., Testech Incorporation, AMERTRON INC, INTEGRATED MICRO-ELECTRONICS INC., Pythos Technology Philippines Incorporated, LOPEZ INC., SIIX CORPORATION