MANILA, Philippines – The Semiconductor and Electronics Industries of the Philippines (SEIPI), the representative body of major players in the local electronics industry, has downsized its forecast export revenues for the year due to softening of demand globally.
The SEIPI board, on Friday, July 24, lowered the forecast to a range of 3 to 5% growth from the original 5 to 7% made at the start of the year.
The latest preliminary export data released by Philippine Statistics Authority (PSA) in May showed that Electronic Products remained the country’s top export with total receipts of $2.357 billion and 48.1% of total exports revenue.
This represented, however, a decline by 7.5% from $2.548 billion registered in May 2015.
The category of Components/Devices which includes Semiconductors, also decreased by 6.9% from $1.917 billion in May 2014 to $1.785 billion in May 2015. It had the biggest share at 38.1% among electronic products.
SEIPI also said that it is looking forward to a better year for investments, adding that existing locators are eyeing expansion but have not indicated any definite plans
Lower Demand in China, Japan and the EU
SEIPI said the lower forecast events in China, Japan and the European Union (EU) have resulted in lower demand.
Both China and EU have faced immense market volatility in the past few months.
China’s stock market has recently seen a dramatic plunge losing more than $3 trillion in value in less than a month from its June 12 peak. China had a flat GDP of 7% in the second quarter of the year amid weak investment and trade.
The world’s second largest economy is currently undergoing a slowdown and is expecting growth of 7% this year. China’s GDP growth eased to 7.4% last year, a 24-year low, and down from 7.7 % in 2013.
The EU on other hand, has seen a volatile month in the markets due to the on-going Greek debt crisis.
The possibility of Greece exiting the Eurozone appeared likely at one point but the indebted nation and its international creditors is set to begin talks on a new Greek bailout this week. – Rappler.com