Electronic exports, which historically account for about half of the country’s outbound shipments, missed its 2016 growth target due to the “misinterpretation” of the government’s policy toward the United States, an industry source said.

The Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI), the country’s largest organization of foreign and Filipino electronics firms, initially targeted an export growth of 2 to 5 percent last year.

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However, exports of electronic products slid 0.1 percent to $28.871 billion in the full year of 2016 from $28.904 billion in the previous year, latest data from the Philippine Statistics Authority showed.

“Demand was tempered by misinterpretation of government policies toward the US,” SEIPI president Danilo C. Lachica told the Inquirer in a text message last week.

President Duterte has been at odds with the US government after former President Barack H. Obama criticized his war on drugs.

The situation was compounded by Mr. Duterte’s remark on the Philippines’ “separation” from the US during a business forum in China.

Although Cabinet officials explained that this only meant an independent foreign policy, Mr. Duterte has nevertheless continued his anti-US rhetoric, even warning to cut defense pacts made with the US government.

The US is a huge market for electronics exports from the Philippines, accounting for 14.08 percent of total electronics shipped for the month of December alone.

The western superpower is second to Japan, which holds 19.43 percent of market share, in terms of top export destinations for Philippine electronics products.

However, SEIPI official said that the industry group was hoping that exports would recover this year given indications that Mr. Duterte was warming up to the controversial US President Donald J. Trump.

“Now that perceptions are being corrected, we hope to see improvement in exports, as evidenced in growth in electronic imports which constitute mostly raw materials to produce the exports,” Lachica said.

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Importation of electronic products went up 6.4 percent to $21.872 billion in 2016 from $20.559 billion in the year earlier.

SEIPI said early last year they were still on track in hitting its export growth target, adding that they were bullish to reach again the $31 billion peak in exports that was hit in 2010.

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