SEIPI: Outlook dims for electronics exports

On higher US tariffs

MANILA, Philippines —  The outlook for the country’s electronics exports this year is at risk amid the United States’ move to impose higher tariffs on Philippine goods, according to the Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI).

In an interview on “Money Talks” on One News yesterday, SEIPI president Dan Lachica said the group initially projected a flat growth for the country’s electronics exports from $42.6 billion last year.

“But we’ve seen some upticks and that caused some optimism. Personally, I thought that we might hit… the 2023 levels of $46 billion, but… these tariff developments have been disappointing and that might just temper our optimistic projections,” Lachica said.

Data from the Philippine Statistics Authority showed that the country’s exports of electronics products from January to May went up slightly to $17.8 billion from $17.6 billion in the same period last year.

US President Donald Trump said in a letter to President Marcos that Philippine goods would be imposed a 20-percent tariff starting Aug. 1.

This is higher than the 17 percent tariff on Philippine exports announced in April.

Lachica said the higher levy is “disappointing” and creates major concerns as it erodes the country’s advantage over Vietnam, which has been increasing its semiconductor exports.

“We were at 17 percent and Vietnam was much higher than that and now we’re at the same level. And Vietnam is one of our biggest competitors, if you will, in terms of attracting foreign direct investments (FDIs) and even exports,” he said.

He said the higher levy is also a surprising development considering that the reciprocal tariffs are intended to address the US trade deficit with its partners and the trade gap with the Philippines is smaller than Vietnam’s.

Data showed that the US goods trade deficit with the Philippines was at $4.9 billion in 2024, while the US trade gap with Vietnam was at $123.5 billion in the same year.

The higher tariff is also a concern as some products in the sector are not exempt from the levy.

As the Philippine government is sending a delegation to the US this week to meet trade representatives, Lachica said the group is hopeful for successful negotiations.

Marcos is also set to visit the US from July 20 to 22.

“Having the President there is always a positive, always something positive and something that we can really look forward to,” Trade Secretary Cristina Roque said in an interview on “Thought Leaders” on One News.

According to Roque, the government continues to push for a free trade agreement.

“That’s something we really need to push because once we have good trade relations or we have a free trade agreement, then it’s easier for us to sell our goods to that particular country,” Roque said.

Lachica said the SEIPI is also hopeful of seeing more investments in the sector.

“We’re seeing some FDIs for electronics companies, but hopefully we will see an increase in that. In terms of inquiries, we’ve seen a lot,” he said, noting that even China is looking at how to promote investments moving from their country to the Philippines.

“So we’re working with them and all other agencies,” Lachica said.