Pax Silica to boost semiconductor industry

MANILA, Philippines — The country’s chief economist said the Philippines should leverage the United States-led Pax Silica initiative to help transition the local semiconductor and electronics industry toward more advanced technologies, particularly as exports emerge as one of the few bright spots in the country’s weak economy.

Speaking to reporters, Economic Planning Secretary Arsenio Balisacan said the Pax Silica initiative is a “positive force for development,” citing its potential to generate advanced exports.

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“The trade sector is contributing much now to our growth. Exports are growing faster than imports and a lot of that is coming from semiconductors and electronics,” Balisacan said.

“The Pax Silica is part of that. If you look at our semiconductors and electronics, we are being left behind because of all these advanced technologies like AI. That’s the challenge,” he added.

As it is, external trade emerged as a bright spot in the economy’s weak 2.3-percent growth in the second quarter, as most other major growth drivers posted slower expansions.

Exports grew 12.2 percent in the second quarter, accelerating from 4.9 percent a year earlier and 7.8 percent in the first quarter.

In June alone, Philippine exports jumped 24.1 percent to an all-time high of $8.8 billion, driven by robust demand for semiconductors, which rose 33.4 percent to $3.8 billion.

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READ: Marcos, Rubio discuss Luzon development, Pax Silica

While imports still outpaced exports, the strong export performance helped narrow the country’s trade deficit to its smallest level in four months.

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Pax Silica, which is seen generating up to $200 billion in export earnings over the next 30 years, is being positioned as a high-tech innovation hub covering critical minerals, semiconductors, artificial intelligence and advanced manufacturing, potentially strengthening the Philippines’ role in global supply chains. INQ