MANILA, Philippines — The Pax Silica Initiative, a United States semi-conductor and artificial intelligence (AI) supply chains, could bring high-tech industries and foreign investments, but without building a Filipino-owned industrial sector.
Research organization IBON Foundation said the initiative risks repeating the country’s long history of hosting foreign-owned manufacturing enclaves that serve profit-making goals of multinational companies while leaving domestic industries undeveloped.
Sonny Africa, executive director of IBON, questioned the government’s projections of up to $40 billion to $70 billion in investments, $200 billion in exports, and nearly one million direct and indirect jobs from Pax Silica.
Africa said the government has been vague about the details on the companies and specific projects that would validate the figures presented.
“They are saying a lot of numbers and promises, but there is no concrete company that is actually giving,” Africa said.
He added that the projected figures would represent a significant increase over the country’s current manufacturing investments, exports, and employment generation.
“If you give justification in a program or project, it will not benefit the country’s economy,” he said.
Africa said the presence of high-tech facilities in the Philippines does not equal Filipino industrialization. Foreign semiconductor companies have operated in the country for decades without producing a strong Filipino-owned industry, he said.
“If that high-tech factory is owned by a foreign company… all the profits will go to them. All the technology will be controlled by them. All the decisions, where they will get the inputs, where they will use their outputs, are theirs,” Africa said.
Africa also said the government should ensure that Filipino companies and technology are integrated into Pax Silica project instead of allowing foreign firms to operate independently within the country.
Land, water and energy concerns
IBON also raised concerns over the use of Philippine land and natural resources for Pax Silica project, particularly within the proposed economic security zone in New Clark City.
Africa said portions of the area had previously been occupied by farming communities and warned that further development could result in displacement.
“A large part of New Clark City, including the 1,600 hectares that were given to Pax Silica, used to belong to farmers,” he said, adding that communities remain in areas surrounding the proposed site.
The group’s concerns also extend to the amount of water and electricity demands depending on the type of semiconductor facility established.
Africa said wafer fabrication could require tens of millions of liters of water daily and significant electricity, while large data centers could require even greater amounts.
“If the wafer fabrication will be built there… sometimes up to 20 to 100 million liters of water are used every day,” he said.
He also questioned whether data centers could eventually be established elsewhere within the broader Luzon Economic Corridor despite government statements about New Clark City.
“It remains to be seen if they are telling the truth that it’s not in 1,600 hectares in New Clark City, maybe it’s outside,” Africa said.
E-waste imports
Meanwhile, environmental groups have separately warned that Pax Silica’s focus on semiconductors and critical minerals could create another potential pathway for electronic waste, or e-waste, imports.
The Basel Action Network and the Environmental Task Force Against Illegal E-Waste Imports to the Philippines have urged authorities to prevent the entry of 184 containers from the United States suspected of containing e-waste.
The groups linked their concern to the possibility of recovering critical minerals from electronic waste through “urban mining.”
Thony Dizon, advocacy officer of BAN Toxics, said semiconductor manufacturing and processing would require critical minerals and that e-waste could potentially become a source of these materials.
“What we should pay more attention to is manufacturing, processing, especially semiconductor, because it will require critical minerals,” Dizon said. “Another method to generate these materials is urban mining, where you mine existing electronic and electrical waste.”
Dizon also called for greater transparency and civil society participation in inspecting suspected e-waste shipments.
“Transparency is very important… We are hoping for the participation of civil society organizations in opening these containers so the public will know that we are fulfilling our obligations under the Basel Convention to protect our health and safety,” he said.
The concern comes as the Bureau of Customs, the Department of Environment and Natural Resources-Environmental Management Bureau, and Subic Bay Metropolitan Authority conducted a joint inspection of nine recycling facilities in the Subic Bay Freeport Zone last July 1 following reports of suspected e-waste.
The agencies said the inspection was part of efforts to ensure compliance with environmental and customs regulations and protect public health and the environment.
The right thing to do
Africa said the government should use the proposed Pax Silica framework to strengthen Filipino industries, rather than simply provide a location for foreign companies.
He said any agreement should prioritize Filipino factories, strengthen Filipino ownership of technology, protect the environment and ensure that the Philippines has a role in managing operations.
“If there is no such cooperation with the Filipino factories, Filipino technology, environmental protection and management of the operations there, any Pax Silica project and any foreign investment will not benefit us,” Africa said.
For IBON, the question is not simply whether Pax Silica can bring high-tech industries to Philippine soil but whether those industries will build Filipino productive capacity and benefit the country’s workers and economy. (davaotoday.com)
