The Philippines’ semiconductor and electronics industry is calling for a collaborative agreement with the European Union (EU) similar to the United States’ CHIPS and Science Act, which allocated $52.9 billion to boost local semiconductor manufacturing.
Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI) Dan Lachica expressed optimism about the sector’s potential to expand with EU support.
“The US CHIPS Act has set a precedent, and the EU has its own version. We’re hoping for increased investments in the Philippines to enhance our semiconductor and electronics capabilities,” Lachica said in a panel discussion Wednesday during the third iteration of the Philippines and EU’s ARISE program at the ongoing National Exporters’ Week.
Under the CHIPS Act, the US launched the International Technology Security & Innovation Fund (ITSI Fund) to improve semiconductor capabilities and supply chain resilience globally.
The Philippines is one of six strategic countries chosen for the endeavor.
Lachica highlighted the Philippines’ significant role in global semiconductor production, noting that the sector accounts for 62 percent of the country’s commodity exports, worth $45.6 billion in 2023, and employs over 3 million direct and indirect workers.
It also contributes 4.5 percent to the national gross domestic product (GDP).
He emphasized the potential for growth in integrated circuit (IC) design, which currently involves six companies, none of which are EU-based.
“We’d like to see EU companies, like STMicroelectronics increasing investments in the Philippines and other European semiconductor and electronics companies consider the Philippines as worthy investment destination,” he added.
He said establishing a semiconductor wafer-fabrication facility here would not only strengthen IC design but also set the stage for a robust supply chain and prototyping infrastructure.
SEIPI said the EU is a growing export market for the country, with Germany and the Netherlands accounting for $4 billion, or roughly 7.4 percent of the Philippines’ total semiconductor exports.
However, Lachica believes there is room to expand, especially in markets like Hungary, where exports currently stand at only $60 million.
With former US secretary of Commerce Gina Raimondo announcing plans to triple the Philippines’ semiconductor output to over $100 billion, SEIPI is optimistic that similar initiatives from the EU will drive further growth and development in the country’s electronics sector.
“The European CHIPS Act could be a game-changer for our industry, and we look forward to seeing concrete actions to support this vital sector,” Lachica said.
