The Philippine government expects the proposed Pax Silica artificial intelligence (AI)-native hub to generate up to $200 billion in exports once fully developed over a 30-year period beginning in 2028, according to the Bases Conversion and Development Authority (BCDA).

The projection underscores the Philippines' push to capture a larger share of the global semiconductor value chain, where it already plays an established role in assembly, testing, and packaging. Electronics consistently rank among the country's top export categories, and the government has identified the sector as critical to sustaining trade-driven growth.

BCDA President and Chief Executive Officer Joshua "Jake" M. Bingcang told reporters on Friday that the 1,619-hectare AI-native acceleration hub in New Clark City (NCC), Tarlac, will be constructed in three phases of approximately 500 hectares each.

"Maybe in the first phase, around 500 hectares, we will see that in three to five years," he said on the sidelines of a briefing.

The agency anticipates attracting 10 to 20 semiconductor locators within the Pax Silica hub during the first phase, Mr. Bingcang noted.

The Philippines joined Pax Silica in April as part of a coalition aimed at securing and developing the supply chains necessary to produce AI-driven infrastructure. Under the Pax Silica framework, Manila and Washington are jointly developing the 1,619-hectare semiconductor manufacturing hub within NCC to produce components critical to AI infrastructure operations. The partnership aligns with broader U.S. efforts to diversify semiconductor supply chains that remain heavily concentrated in East Asia, a vulnerability highlighted during recent global chip shortages.

Technology components considered essential to the AI supply chain include AI chips, memory and storage, high-speed networking, data centers, and power and cooling systems.

The project has drawn scrutiny from various sectors over concerns about environmental degradation, the alleged displacement of local communities, and potential implications for national interest.

Addressing concerns that data centers could strain water resources, Mr. Bingcang stated that no hyperscale data centers will be developed inside the Pax Silica hub, as NCC's power and water capacity cannot support the demands of AI-driven data centers. This contrasts with an earlier statement from the Department of Information and Communications Technology, which indicated that data centers in the industrial hub could have a capacity of at least 400 megawatts.

Mr. Bingcang added that an American company had canceled plans to build a hyperscale data center in NCC and chose to invest in Malaysia instead, as the Tarlac zone could not meet its power requirements. The loss reflects intensifying competition across Southeast Asia, where countries including Malaysia, Vietnam, and Indonesia are aggressively courting data center and semiconductor investments.

"Even if we will invite hyperscalers, they will not go," he said.

During the briefing, Trade Undersecretary Ceferino S. Rodolfo emphasized that the Pax Silica hub will be built on government-owned land.

"It's a titled public land for industrial use. No farmers, no indigenous communities will be displaced," he said.

Mr. Rodolfo described the Pax Silica bloc as an "international non-binding declaration of shared principles focused on securing and coordinating supply chains for advanced technologies essential to the AI era."

While Pax Silica is a non-binding agreement, officials stressed the importance of coordinated efforts to attract investments and ensure long-term investor commitment.

"We share the same principles and you are branded as a trusted partner. But what is more important is the coordinated effort to bring in investments," Mr. Rodolfo said.

— Beatriz Marie D. Cruz