The local electronics and semiconductor industry is losing export opportunities to the United States (US) in the absence of a free trade agreement (FTA) with the Philippines.
Dan Lachica, president of Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI), told reporters on Monday around $5 million to $10 million have initially been lost in the electronics manufacturing services (EMS) sector of the industry since last year.
Lachica said the amount could swell in coming years as US companies continue to prefer sourcing products from those with trade agreement accreditation (TAA).
“They will not accept products unless these (come from) multinationals. They will not accept products unless they are from a country where the US has an FTA,” Lachica said.
EMS are finished products of assemblies and sub assemblies.
“Since they know we don’t have an FTA (with the US), some companies may just not want our EMS companies to export to the US,” Lachica added.
He said a TAA can only be obtained through an FTA and is not viable in other trade platforms like the Indo-Pacific Economic Framework.
“So we have to work on an FTA,” Lachica said.
The Philippines thus lose out to countries that do the box builds, a finished assembly of an electronics product, and which have an FTA with the US. These include Malaysia, Vietnam and Korea.
