US hints funding for PH workforce, energy dev’t

As part of its commitments to boosting the Philippines’ semiconductor industry, the United States government is looking at workforce development and resilient energy supply as potential priority areas for funding under the CHIPS Act.

In a press briefing on April 30, visiting US Secretary of State for the Bureau of Economic and Business Affairs Ramin Toloui said the US government wants to make “small, targeted investments with this fund that help catalyze the larger, more important investments from the private sector.”

With the help of the Organization for Economic Cooperation and Development (OECD), they are conducting a study on the assembly, testing and packaging (ATP) ecosystems of the six partner countries to receive funding under the International Technology, Security, and Innovation Fund (ITSI) of the CHIPS and Science Act.

Under the CHIPS Act, each partner country will receive $100 million over five years from the $500 million total fund for different activities determined to be priority areas.

“The kind of areas that are important that came up were  workforce development. How do we make sure that the Philippine educational system is producing the engineers, technicians that are critical to these ATP facilities. [Another is] energy and the importance of making investments to ensure reliable supplies of energy,” he said.

He emphasized that the development of the local semiconductor industry has a direct impact on increasing employment and even a spillover effect to other sectors.

“It’s an opportunity to create some skilled jobs in the Philippines, but also provide a platform for further developing mature industries, whether its elsewhere in the semiconductor space or other industries requiring engineering and technical knowledge,” he added.

Aside from workforce development and energy, the general importance of the investment climate, and ease of doing business (EODB) were also mentioned.

Toloui noted that the Philippine government, private sector, and other stakeholders are actively engaging with the OECD on the study. “So we have a strong basis for identifying the steps that the Philippines can take to maximize investments in the semiconductor industry,” he said.

Given the back-to-back visits to the Philippines of key US officials like Undersecretary for Economic Growth, Energy, and Environment Jose Fernandez, Commerce Secretary Gina Raimondo, and Secretary of State Anthony Blinken, Toloui said there is greater information for the OECD review.

“We’ll expect in the coming months to be programming specific allocations on CHIPS Act funding, informed by that OECD study and working with the government to try to target these priority areas,” he said adding that the  US government has signed a contract with the Arizona State University (ASU) as its implementing partner on some of the CHIPS Act funding.

He said that ASU has a long history of  working on workforce development issues related to semiconductors in the US and other countries. “We’re in discussions with taking the results of the OECD study, how to turn that into specific programming that is willing to address the issues,” he said.

“Before the study is made public, we will be able to use the results of the interim report to actually make some funding decisions, those should be available within a couple o months,” Toloui added.

The Secretary emphasized that the US wants to have a “resilient and substantial capacity” for its semiconductor supply, seeing the Philippines as an integral part of its international supply chain.

While the US’ involvement in the industry is focused on ATP, he said assistance to develop the local sector beyond the downstream manufacturing line can be seen when the time is right.

“As is the case in many industries, there is an evolution overtime by developing expertise in one part of the value chain, often provides a basis for expanding into other parts. Our focus is now on the ATP. We think that’s an enormous need for the global economy, but of course, that doesn’t foreclose at a later point in time that circumstances could be in place to develop other parts of the value chain in the Philippines,” he said.

This is the fourth stop of Toloui’s economic mission in Asia, which began in Tokyo, Japan followed by visits to Seoul, South Korea, and Ho Chi Minh, Vietnam, concluding in Singapore. — Khrischielle Yalao