MANILA — The Philippines is banking on booming global demand for semiconductors, artificial intelligence (AI), and data center infrastructure to sustain record export growth and push merchandise exports beyond $100 billion for the first time in 2026.
The Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI) credited the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act with strengthening investor confidence and encouraging companies to expand production capacity.
Philippine merchandise exports hit a record $9.11 billion in August, up 27.8 percent from $7.13 billion a year earlier, according to figures cited by SEIPI. Exports for January to August also reached a record $64.04 billion, a 14.8 percent increase from the same period in 2025.
“Look at Electronics and AI. Semiconductor & Electronics accounted for 59.3 percent of our exports last year. In August, it was 71.4 percent,” Trade Undersecretary and Board of Investments Managing Head Ceferino S. Rodolfo said.
He said the country could surpass $100 billion in merchandise exports this year if the momentum continues through December.
Electronics generated $49.6 billion, or 59.3 percent of the Philippines’ total merchandise exports of $84.48 billion in 2025. In August 2026, electronic products accounted for $6.2 billion, or 71.4 percent of total exports, SEIPI said.
The industry group has raised its 2026 electronics export growth forecast to about 10 percent, equivalent to $54 billion to $55 billion, as demand for AI-related technologies and data centers strengthens.
“AI is creating an extraordinary demand cycle, and it goes far beyond the AI processor itself,” SEIPI President Dan Lachica said. “AI needs power electronics, storage, connectivity, semiconductors, and enormous data-center infrastructure.”
Although the Philippines does not manufacture AI chips, Lachica said local companies already supply components used across the technology ecosystem. He said the country must attract more investment to capture a larger share of the expanding market.
CREATE MORE bolsters
investor confidence
SEIPI identified the CREATE MORE Act, or Republic Act 12066, as a key reform supporting investment by strengthening the incentives framework for registered export enterprises. The law took effect in November 2024.
The industry is already seeing capacity expansions. Toshiba, for example, is undertaking a multibillion-peso expansion in the Philippines over three years that is expected to create about 3,000 jobs and increase production of nearline hard disk drives used in data centers.
Finance Secretary Frederick Go said the country's export performance and policy reforms put the Philippines in a position to benefit from rising demand for AI and digital infrastructure.
“Our goal is to attract more investments, create greater opportunities for Filipino workers and enterprises, and strengthen the Philippines’ role in global technology supply chains,” Go said.
The Semiconductor and Electronics Industry Advisory Council, chaired by Executive Secretary Ralph Recto, is also working to improve coordination among government agencies, remove regulatory bottlenecks, and develop the industry's workforce.
The Philippine Semiconductor and Electronics Industry Roadmap aims to strengthen advanced semiconductor assembly, testing and packaging, electronics manufacturing services, integrated circuit design, AI and high-performance computing.
The industry has set a target of developing 128,000 workers by 2030 across assembly, testing and packaging, electronics manufacturing services and integrated circuit design.
“Incentives can help win today’s investment. Filipino talent will determine whether we win the next generation of investment,” Recto said.
Infrastructure, supply
chains key to growth
SEIPI also pointed to the Luzon Economic Corridor, which links Subic Bay, Clark, Manila and the Calabarzon region, as a way to align infrastructure investments with the needs of advanced manufacturing.
The corridor prioritizes transportation and logistics, energy, digital infrastructure and advanced manufacturing — areas that affect production costs and companies’ investment decisions.
Reliable power, efficient ports and airports, water supply and digital connectivity will be crucial to attracting more semiconductor investments, the group said.
The Philippines also joined the U.S.-led Pax Silica initiative in 2026, expanding opportunities for cooperation in AI supply chains, semiconductors, advanced manufacturing, critical minerals and workforce development.
The United States remained the Philippines’ largest export market in August, receiving $2.17 billion worth of shipments, or 23.8% of the country’s total exports for the month.
Philippine Chamber of Commerce and Industry President Perry Ferrer said the electronics industry's expansion could also create opportunities for small and medium-sized enterprises to join technology supply chains.
“The SMEs want to be part of this technology growth sector,” Ferrer said.
He added that Philippine electronics manufacturers supply components that help American companies compete, expand production, and support jobs in the United States.
Beyond export records
The Board of Investments is developing a proposed Philippine Technology Corridor that would connect different industrial hubs, including New Clark City for advanced manufacturing, Metro Manila for integrated circuit design and innovation, Mindanao for critical minerals, Batangas for AI computing and digital infrastructure, Aurora for connectivity, and Bulacan as a prospective wafer fabrication site.
Rodolfo said connecting these capabilities could help the Philippines move beyond individual semiconductor plants and data centers toward a broader technology ecosystem.
SEIPI said the long-term goal is to turn the current export boom into stronger domestic industries, higher-value manufacturing, improved technological capabilities and more skilled jobs for Filipinos.
“Although we are not starting from scratch — as we have the industry, the talent and the experience to build on — this transformation will require hard work, sustained commitment and, above all, a strong partnership between government and industry,” Ferrer and Lachica said in a joint statement. PR