In the midst of the Global Financial Crisis battering our IT industry
ANGARA: "TIME TO CHANGE OUR ELECTRONICS STRATEGY"

Senator Edgardo Angara today called for a change in the national strategy for the $31bn/year electronics sector that employed more than 464,000 direct employees last 2008. "Intel's local closure is a signal that it is time to change our electronics strategy, and to focus on our homegrown sector," he said.

"We must now concentrate on strengthening our local electronics and semiconductor companies. After all, in the end, they will be the ones who will stay with us through thick or thin." One immediate way, said Angara who chairs the Senate Committee on Science and Technology, is to strengthen our credit guarantee agencies like the Export Import bank, as the sector badly needs a strong credit guarantor in its hour of need.

Angara also mentioned the need to move up the value chain, when the recession ends.

He added, "We need to invest in R&D, particularly in this new 'ITRI-type' R&D organization that will be the lynchpin of developing a vibrant local electronics/semiconductor sector."

He expects that competition with countries like Vietnam and China for new business will continue to be tough once business picks up.

Angara noted the fact that majority of our semiconductor and electronics industry is predominantly multinational based. While he says we should continue to attract foreign investors here, "in the end we need to invigorate our local semiconductor and electronics sector, for they will be the ones to stick with us through thick and thin." He pointed out that Taiwan and Singapore used this strategy to jumpstart their economic development.

He said that this market weakness is a worldwide trend that affects everyone, but eventually the electronics and semiconductor sector will recover, "as people will eventually have to replace their PC's, cellphones," he said. "We need to use this crisis as a turning point for our electronics/sector, to shift us into a higher value added country. To do that, the government has to invest in training and R&D," he added.

Angara, who co-chairs the Congressional Commission on Science & Technology and Engineering (COMSTE) with Representative Joseph Abaya (1st District, Cavite), which has been looking at ways to improve the country's competitiveness in six key areas, one of which is the electronics and semiconductor sector. The COMSTE has several recommendations for the electronics and semiconductor sector, including the creation of an "ITRI-type" R&D institute patterned after Taiwan's prestigious Industrial Technology Research Institute (ITRI).

For the longer term COMSTE is crafting an S&T strategy for the Philippines that will make us competitive in high value added products like green electronics, biomedical devices and systems, and chip design. Investment in these high growth areas will be coordinated by a consortium of Academe, Industry, Investors and Government S&T agencies.