A new policy of the United States restricting chip sourcing from China is seen as beneficial to the Philippines owing to the resiliency of the local semiconductor and electronics sector that is dominated by American multinationals, according to Dan Lachica, president of the Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI).
For Lachica, China chip export controls “could actually be beneficial (because) we’re going to have another source of semiconductor wafers.”
“Insourcing of semiconductor wafers from the US … over time, maybe in a couple of years, (means) another source of wafer. The semiconductor sector here is dominated by American multinationals, albeit in assembly test and packaging, which would stand to benefit from sourcing wafers from the US wafer fabs,” Lachica said in a television interview recently.
Lachica also does not see this restrictive policy of the US with China as hurting the supply chain.
“We haven’t really seen the pronounced effects of this. We’re a very resilient industry even during the pandemic. In fact, last year, we actually recorded $45.9 billion of exports, which was higher than pre- pandemic levels. So whether (or not) there are disruptions, shutdowns or whatever, we figure out a way because we supply to the global market. We figure out a way to stave off the threats… perhaps (this would be) adding additional logistics cost and processing fees, but by and large will be will be okay,” Lachica added.
He said with the new coronavirus disease 2019 slowly transitioning from pandemic to endemic, “we’ll see less of (supply chain) restrictions on wafers and raw material supplies.”
n the peso’s weakness, Lachica said the industry benefits from the devaluation of the peso like other exporters.
For every peso devaluation, a one to 1.5 percent increase in dollar export revenue is generated.
But he said global and national factors have changed the landscape and offset the gains notably the Ukraine- Russia trade war which increased fuel prices and raw materials which redound to increased processing costs.
“The one to 1.5 percent upside in revenue is no longer seen because… local expenses with the inflation and everything, materials headcount, logistics have increased,” Lachica added.
