Overseas sales of PHL electronics expected to increase 5-6% next year

THE PHILIPPINES’ electronics exports will likely increase 5-6% next year, supported by robust demand for gadgets and Internetconnected equipment, a group representing the country’s key semiconductor industry said on Monday.

For 2016, the Semiconductor and Electronic Industries in the Philippines, Inc. (SEIPI) has forecast an increase of 6%.

Danilo C. Lachica, SEIPI president, said 2017’s “modest” anticipated gains will be driven by components, electronic data processing, telecommunications, automotive sectors, cyber security, self-driving cars and the general trend toward a digital society.

Electronics are the Philippines’ top export item, and in October accounted for 52% of export revenue, according to the Philippine Statistics Authority.

So the relatively firm outlook for 2017 bodes well for overall economic growth.

But President Rodrigo R. Duterte’s comments about cutting ties with Washington posed some risks, Mr. Lachica said, noting that 12% of the industry’s exports go to the United States.

While the industry supports Mr. Duterte’s move to expand commercial ties with other countries, Mr. Lachica said “it should not be at the expense of cutting ties with the US.”

On Friday, Mr. Duterte told the US “we do not need you,” and that it should “prepare to leave” the Philippines.

SEIPI, comprising 270 semiconductors and electronics manufacturers — including units of Toshiba and Texas Instruments employing more than two million workers — wants to grow its business with the US, Mr. Lachica said.

The Philippine central bank expects total exports to contract 3% this year, due to sluggish global demand, but expand 2% next year. —