[News] US Chip Supply Chain’s Expansion into the Philippines Nears?

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In recent years, influenced by complex international dynamics and the need to safeguard supply chain security, Southeast Asian countries such as Singapore, Malaysia, and Vietnam have become prime locations for numerous semiconductor giants to establish overseas operations. Now, the Philippines may join the ranks of these nations.

Recently, U.S. Secretary of Commerce Gina Raimondo addressed her desire to assist the Philippines in doubling its semiconductor facilities to lessen the geographic concentration of the global chip supply chain.

Previously, according to the press release of the U.S. Department of Commerce, Raimondo has announced the plan to invest USD 1 Billion in Philippines.

“The Indo-Pacific includes some of the most dynamic economies in the world. It was an honor to lead the first-ever trade mission of this nature to the Philippines and to underscore the immense potential, which is evident in the more than $1 billion of investments from this mission alone,” said Raimondo.

According to Taiwantrade’s Data, it has indicated that the semiconductor and electronics industry is the top-performing sector among the Philippines’ export commodities, accounting for approximately 60% of total commodity exports.

The semiconductor industry in the Philippines primarily focuses on the assembly and testing sector. With a high literacy rate and a young workforce proficient in English, the Philippines has become a significant assembly and testing hub for global semiconductor giants such as Amkor, Intel, ADI, and TI (Texas Instruments).

Geographically, the semiconductor industry in the Philippines is concentrated in four main regions: Manila, Calabarzon, Northern/Central Luzon, and Cebu. Among these regions, Manila stands out as the primary hub, hosting assembly and testing facilities for globally renowned companies like Amkor, Onsemi, as well as Toshiba’s hard drive assembly plant.

Currently, the Philippines has 13 semiconductor assembly, testing, and packaging facilities. Most of the products produced are exported to other regions for assembly or application. The integrated circuits (ICs) used in these facilities mainly come from Taiwan, the United States, and Japan, with finished products primarily exported to Singapore, China, and Japan.

However, the Philippines is not content with just the assembly and testing sector. In February of this year, it was previously reported by Philippine Board of Investments (BOI) in its press release, stating that the BOI would collaborate with the United States to expand its semiconductor capabilities, including the construction of its first fab.

The BOI aims to build a laboratory-scale fab. This facility will provide general manufacturing process technology to encourage local semiconductor startups and train semiconductor engineers.

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(Photo credit: Intel)