The government’s chief economic planner said the Philippines must minimize its exposure in case the geopolitical situation deteriorates, with analysts citing the potential of the China-Taiwan standoff to escalate. READ:
“There are geopolitical risks we have to live with that. That should not constrain you from planning for continued, sustained growth. We can take those. We need to be ready,” Socioeconomic Planning Secretary Arsenio M. Balisacan told reporters after the European Chamber of Commerce of the Philippines meeting last week.
“In fact, over the years Taiwanese firms have poured in P32.3 billion in total investments in export-oriented enterprises in economic zones registered with the Philippine Economic Zone Authority , mainly in electric equipment and apparatus, metal products manufacturing, as well as in the real estate sector,” Mr. Villegas wrote.
“Taiwan is by far the world’s biggest producer of the processor chips that are increasingly ubiquitous in new products. It has twice the market share of the next biggest producer. Its dominance at the high end is even greater: 92% of the most advanced semiconductors are made by TSMC in Taiwan,” he said in a Capital Economics publication.
“In the near term, there might be some supply chain dislocations because of the military drills in the Taiwan Straits but this should be minor. In the long term, so long as there is no escalation in military operations, there could be some fall in business confidence which could affect economic growth in the region. But overall, I don’t see much impact,” he said in an e-mail.