philippines electronics industry

7/29/2019 philippines electronics industry

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TTHEHE

PPHILIPPINEHILIPPINE

EELECTRONICSLECTRONICSIINDUSTRYNDUSTRY

- T H E D R I V E R O F T H E P H I L I P P I N EE C O N O M Y

E R N I E B . S A N T I A G OS E I P I P R E S I D E N T


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CHANGING FACE OFCHANGING FACE OF

EXPORTSEXPORTS

Agro-Based49%

Garments - 7%

OtherManufacturedProducts 10%

Forest Products - 10%

Others - 2%

-

Machinery and Transport - 4.4%

Wearables - 0.16%

Food - 2.9%

Motor Vehicles and Parts - 1.74%Home Furnishings - 1%

Marine Products - 1%

Giftwares - 0.45%

Construction Materials - 0.49%

Organic Products - 0.18%

Mineral Products - 2.1%

-

FROM COCONUTCOCONUT CHIPSCHIPSTO MICROCHIPS

Mineral Products -18%

ELECTRONICSELECTRONICS -- 3%3%

19701970ELECTRONICSELECTRONICS --

61%61%

20102010

Sources : DTI/NSOSEIPI


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PHILIPPINE ELECTRONICSPHILIPPINE ELECTRONICS

INDUSTRYINDUSTRY

Philippine Exports WITH Electronics


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Philippine Exports WITH Electronics

PHILIPPINE ELECTRONICSPHILIPPINE ELECTRONICS

INDUSTRYINDUSTRY

Philippine Exports WITHOUT Electronics


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THE TOP CHIPMAKERSTHE TOP CHIPMAKERS

7 OUT OF THE WORLDS TOP 20 CHIPMAKERS ARE

OPERATING IN THE PHILIPPINES

TIPI Philips Fairchild

Analog Sanyo On Semi Rohm

Source: SEIPISEIPI


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THE WORLDS TOP ELECTRONICSTHE WORLDS TOP ELECTRONICSFIRMSFIRMS

FOUR OF THE LARGEST HDD PRODUCERS ARE IN THEPHILIPPINES

Hitachi Toshiba Fujitsu NEC

CEBU MITSUMI employs >20K, biggest employerin the Philippines; manufactures computerperipherals and components such as CD-R,CD-RW, optical pick up

Source: SEIPISEIPI


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AMKOR employs 8,000 people for its ICpackaging with 400 formats, from leadframe toBGA solutions

THE WORLDS TOPTHE WORLDS TOP ELECTRONICSELECTRONICSFIRMSFIRMS

emp oys , , one o e op erm naprinter production base of global Epson group,producing its 10 millionth printer recently

LEXMARK produces 40 million printheads/year

Source: SEIPISEIPI

CONTINENTAL TEMIC produces automotiveelectronics parts (sensors, auto accessories, etc.)


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HOMEGROWN SMS AND EMSHOMEGROWN SMS AND EMSFIRMSFIRMS

IMI Ionics P I Fastech Team

and a cluster of homegrown ODMs time recorder,avr, power supplies, alarm systems, electronic

ballasts, testers, gps tracking, automated tollcollection, others

Source: SEIPISEIPI


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IC DESIGN: ASIC AND FPGA DESIGN, VHDL

VERIFICATION (ROHM LSI DESIGN PHILS., SANYO

There is a budding silicon design and development industry

in the Philippines

SILICON DESIGN ANDSILICON DESIGN ANDDEVELOPMENTDEVELOPMENT

SEMICONDUCTOR, EAZIX, SYMPHONY, BITMICRO) IC PACKAGING DESIGN: (TI, FAIRCHILD SEMICON)

MODULE DESIGN, PRODUCT DESIGN:

(LEXMARK, EAZIX) FIRMWARE: EMBEDDED SYSTEMS HW/SW, EMBEDDED

LINUX

(CANON I.T., TSUKIDEN)

Source: SEIPISEIPI


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Magnet Actuator

Diodes Base& CoverCoils

SpacerRing

Motors

A GROWING BASE OFA GROWING BASE OF SUPPLIERSSUPPLIERS

FOR HARD DISK DRIVES (HDDs)FOR HARD DISK DRIVES (HDDs)

ICs Connectors

Capacitors Transistors

PackagingMaterials

PlasticMolded Parts

Screws

Resistors

PCB/PCBA

MetalPressed PartsMagnetic

Head

CarriageAssembly

SUPPLYING THE WORLD WITH 2.5 MILLION HDD PER MONTHSource: SEIPI

SEIPI


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Microprocessors Logic Devices

Strong in assembly, test and packaging design

for semiconductor manufacturing servicesDSPs

TESTTEST ANDAND PACKAGING DESIGNPACKAGING DESIGN

Analog Devices Flash Memory

Power Devices

CAPTURING 10% OF THE SMS WORLD

SUPPLY

Memory Chips Opto Devices

Source: SEIPISEIPI


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COMPETITIVENESS OF THECOMPETITIVENESS OF THEINDUSTRYINDUSTRY

CRITICAL MASS OF GLOBAL PLAYERSCRITICAL MASS OF GLOBAL PLAYERS

Source: SEIPISEIPI


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NUMBER OF FIRMS: 936

THE COMPANIES IN THE INDUSTRYTHE COMPANIES IN THE INDUSTRY

NATIONALITY:- 72% Foreign-

Others

8%

Japan

30%

Sources: Philippine Board of Investments (BOI) &

Philippine Economic Zone Authority (PEZA)

Philippines

28%

Malaysia

2%Singapore

2%

Taiwan

4%

Europe

7%

USA

9%

Korea10%

Source: BOI/PEZASEIPI


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ISO Certified

Practices the Best Known Methodsin Manufacturing (JIT,TQM, 5S, QPIC)

Capabilities Range from IC Packaging,PCB Assembly, Full Product Assembly

PROFILEPROFILE OF TYPICALOF TYPICAL

ELECTRONICS COMPANIESELECTRONICS COMPANIES

Runs at 3 Shifts a Day

In-house Training Capability

Non-Unionized with Low Turnover

Better Compensation Package

Operates with clean rooms and fullyintegrated manufacturing facilities

Located in Economic Zone or BOI Registered

Source: SEIPISEIPI


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LOCATION OF ELECTRONICSLOCATION OF ELECTRONICS

COMPANIESCOMPANIES

Metro Manila42%

Northern/Central Luzon

3%

Calabarzon48% Cebu

7%

Sources: PEZA & BOI

SEIPI


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COMPETITIVENESSCOMPETITIVENESS OF THEOF THEINDUSTRYINDUSTRY

PEOPLEPEOPLE

Source: SEIPISEIPI


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DIRECT EMPLOYMENTDIRECT EMPLOYMENT

19921992--20102010

2010 FIRST TIME TO REACHOVER 500K DIRECT JOBS

Sources: BOI/PEZASEIPI


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STRENGTHS OF FILIPINOSTRENGTHS OF FILIPINOWORKERSWORKERS

AVAILABLE- a labor force of 36 Million- about 100,000 engineering

and technical graduatesevery year

TRAINABLE AND

TECHNICALLY CAPABLE- need only 6-8 weeks to learntechnical skills

Source: SEIPI

COST COMPETITIVEFunctional Head - US$ 38400-73386/annum

Production Engineer - US$ 3466-10066/annumProduction Operator - US$ 1980- 3869/annum

FLEXIBLE- Multi-skilled, English speaking- Operates at 3 shifts /day- Minimal turn-over rate

SEIPI


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ELECTRONICS EXPORTS:ELECTRONICS EXPORTS:19921992 -- 20102010

25

30

35

25,3427,07

23,7624,17

26,6427,30

29,60 3128,50

22 20

31.1

US$BILLIO

NS

2010 THE HIGHEST IN HISTORY

Sources: National Statistics OfficeBureau of Export Trade Promotion, DTI

-

5

10

15

20

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

2,973,78

4,897,55

10,61

14,98

19,87

,

SEIPI


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DESTINATIONSDESTINATIONS OF EXPORTSOF EXPORTS

USAUSA--14%14%

EUROPEEUROPE--22%22%JAPANJAPAN -- 15%15%

CHINACHINA -- 13%13%

Source: Bureau of Export Trade Promotion, DTI

EXPORTS DESTINATIONEXPORTS DESTINATION USA & EUROPE: 36%USA & EUROPE: 36% ASIA:ASIA: 64%64%

OTHER ASIAOTHER ASIA -- 36%36%

SEIPI


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ELECTRONICS INVESTMENTSELECTRONICS INVESTMENTS19921992--20102010

2,00

2,50

2,16

1 47

2,27

US$BILLIONS

2010 THE HIGHEST IN HISTORY7TH TIME OVER US$ 1B

0,00

0,50

1,00

,

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

0,04

0,22

1,291,08

0,670,79

1,24

0,72

0,270,23

0,44

0,78 0,75

,

0,420,47

SEIPI


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STRONG START,STRONG START,ENCOURAGING FINISHENCOURAGING FINISH

SEIPI


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1. JOBS + 25K

2010: A GOOD YEAR2010: A GOOD YEAR

.

3. INVESTMENTS + 384%

SEIPI


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Several large multinationalsare revisiting their long-termstrategies and are making decisions

BUSINESS ENVIRONMENTAL SCANBUSINESS ENVIRONMENTAL SCAN

now.

Theres a growing sentiment toreassess their geographical footprint

in Asia.

SEIPI


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However, it is also clear that China is notthe only player. The China + + strategy islikewise still in play.

BUSINESS ENVIRONMENTAL SCANBUSINESS ENVIRONMENTAL SCAN

Vietnam is very popular. Malaysiacontinues to have the rightinfrastructure. Indonesia is gearing up.

The Philippines is in a very good situationto be part of the action. The timing is now!

SEIPI


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Given this business condition,the industry is bullish to sustain,if not further increase the growth

INDUSTRY OUTLOOKINDUSTRY OUTLOOK

in the Philippines

Moreover, there is growing optimismdriven by the general industry feeling thatthe new government of President Aquinois morally upright and is full of promise

SEIPI


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INDUSTRY TARGETINDUSTRY TARGET

The industry aims to double-up electronics exports

From US$ 22 Billion in 2009

To US$ 50 Billion in 2016

SEIPI


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40

50

34343737

40404444

4848>50>50

US

Billions

EXPORT TARGETSEXPORT TARGETS

20102010--20162016

-

10

20

30

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

3 45

811

15

20

2527

2224 24

27 27 3031

29

22

3131

Sources: NSO/DTISEIPI


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1.1. INCREASE CAPACITYINCREASE CAPACITY

2.2. IMPROVE TECHNOLOGYIMPROVE TECHNOLOGY

DOUBLINGDOUBLING--UP EXPORTSUP EXPORTS

3.3. LOWER THE COST OF BUSINESSLOWER THE COST OF BUSINESS

4.4. CREATE A CONDUCIVE ENVIRONMENTCREATE A CONDUCIVE ENVIRONMENT

SEIPI


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INCREASING INVESTMENTSINCREASING INVESTMENTS

ANNUAL TARGET OF US$ 2 BILLIONANNUAL TARGET OF US$ 2 BILLION

PROMOTE THEPROMOTE THE

SEIPI

AND THE GREAT FILIPINOAND THE GREAT FILIPINOELECTRONICS WORKERSELECTRONICS WORKERS


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DEVELOPING TECHNOLOGYDEVELOPING TECHNOLOGYROADMAPROADMAP

MANUFACTURINGMANUFACTURING

PACKAGING, ASSEMBLY, TEST, WIREPACKAGING, ASSEMBLY, TEST, WIREBOARD, RF COMPONENTS, POWERBOARD, RF COMPONENTS, POWERMANAGEMENT, ETC.MANAGEMENT, ETC.

SEIPI

PV/SOLAR

AUTOMOTIVEELECTRONICS

MASSDATASTORAGE

R&D


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LOWER COST OF BUSINESSLOWER COST OF BUSINESS

LOWER COST OF POWERLOWER COST OF POWER

SEIPI


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A CONDUCIVE BUSINESSA CONDUCIVE BUSINESS

ENVIRONMENTENVIRONMENT

INFRASTRUCTUREINFRASTRUCTURE

SEIPI

NONNON--DISRUPTIVE LABORDISRUPTIVE LABOR

CONTINUE WHAT HAS BEEN GIVENCONTINUE WHAT HAS BEEN GIVEN


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THE INDUSTRY AS DRIVERTHE INDUSTRY AS DRIVER

PUBLICPUBLIC--PRIVATE PARTNERSHIPPRIVATE PARTNERSHIP

SEIPI

THE GOVERNMENT AS ENABLERTHE GOVERNMENT AS ENABLER

SOME MEN SEE THINGS AS THEY ARE


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AND SAY WHY?

II DREAMDREAM THINGSTHINGS THATTHAT NEVERNEVER WEREWEREAANDND SAYSAY WHYWHY NOTNOT??

G B SG B S

SEIPI


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