• BPO seen crucial to inclusive growth

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    The country’s business process outsourcing (BPO) industry is a key factor in achieving inclusive growth, according to Science and Technology Secretary Mario Montejo.

    Speaking at the opening of the three-day International Contact Center Conference and Expo (ICCCE) in Cebu City, Montejo said that the industry has been generating real jobs and opportunities not just within Metro Manila, but throughout the country.

    He said that BPO hubs outside Metro Manila, including the cities of Baguio, Cebu and Davao, now account for 20 percent of the industry’s revenues. By 2016, 40 percent of BPO jobs, or 525,000 out of 1.3 million, are expected to be in these “next wave cities.”

    In 2012, the country’s BPO industry grew to $13 billion from $11 billion in 2011, or an 18-percent increase. Employees also rose by 21.8 percent from 640,000 in 2011 to 780,000 last year.

    University of Asia and the Pacific Economic Prof. Bernardo Villegas said that if this growth continues, the country’s economy might even match those of China and India in 20 years. Villegas was one of the speakers at the conference.

    Villegas also said that the Philippine BPO industry will benefit from the integration of the Association of Southeast Asian Nations (Asean) economic bloc in 2015. He said that the integration would result in the regionalization of businesses, where local businesses will be replicated or extended elsewhere.

    Villagas believes that the Asean’s anticipated resurgence is different from the growth of Singapore, Hong Kong, Taiwan and South Korea in the 1990s. The four countries had small populations, little natural resources and strong dependence on exports, while Indonesia, Vietnam and the Philippines currently have a combined population of around 400 million and are all rich in natural resources, and their big domestic markets make them relatively less susceptible to global downturns.

    According to TJ Singh, Gartner Research vice president, the Philippine BPO industry has developed a niche in the global market, and it should extend this niche by furthering the development of its huge and young pool of potential workers.

    Montejo said that one way to improve the industry is to increase public-private partnership projects to sustain its growth and its reputation as the world’s second call center destination behind India.

    For Villegas, it is crucial to develop the country’s educated, English-speaking workforce as it is one of the key ingredients for the industry’s growth. He added that there is also a need to continue investments in education and infrastructure to seize the opportunity from global markets.

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