Trade and Industry Secretary Cesar Purisima Monday warned that Malaysia and Singapore are likely to overtake the Philippines as a leader in offshore outsourcing market if it fails to improve its business environment, as well as its infrastructure.
Purisima said Malaysia and Singapore has been ranked as “up and comers” among member countries of the Association of Southeast Asian Nations (ASEAN) owing to their advantages, including world-class infrastructure with good business environment and strong government support for the information and communication technology sector.“The Philippines will be threatened, as ASEAN countries like Malaysia and Singapore, ranked as up and comers, are close at the heels of the Philippines,” he warned.
He explained that the Philippines should not be complacent to be able to maintain its lead as more and more ASEAN countries are becoming strong contenders over the years.
He said the government needs to improve the country’s business environment by making the Philippines more attractive for investors and a haven for profitable ventures.
“We are addressing this through certain government programs and policies, such as incentives offered to IT and telecommunication business ventures. But more government and private sector cooperation and undertakings will be needed to make this happen,” Purisima said.
The DTI chief cited the CIO Offshore Outsourcing/Global Guide Study, a survey of 101 information technology executives that listed the Philippines, India, Canada and Israel as leaders in global outsourcing.
“The CIO survey affirms the country’s claim to being an IT services hub in Asia and a strong endorsement of our competitive advantage in attracting IT projects from well-established global firms,” Purisima stressed.
Besides Malaysia and Singapore, other countries cited as up and comers were China, Hungary, Poland, Russian Federation, South Africa, Mexico and Brazil. Among the rookies were Thailand, Vietnam, New Zealand, Romania, Bulgaria, Ukraine, Costa Rica and Argentina.
The rankings were based on the maturity of the industry, the size of the market, the availability and cost of skilled labor, and the infrastructure (both government support and actual technology infrastructure) to support a significant IT services market.
The advantages of the Philippines cited in the study include historic military presence, high percentage of English speakers with American accent and Filipinos brought up with aim-to-please attitude.
It also reported the estimated 15,000 technology students that graduate from universities annually.
The study showed that India remains the heavyweight champion of business process and IT-services outsourcing. Ireland was described with a sterling reputation for producing highly skilled IT professionals. Israel is endowed with highly skilled work force including scientists and engineers from Eastern Europe and Russia.
This year, the DTI expects investments in the local business process outsourcing that includes customer contact centers, or call centers, to double to as much as P13 billion from P6.42 billion last year.
Call centers in the Philippines include America Online, INFONXX, Reese Brothers, Vocativ Systems, SVI Connect Corp., US Asia Solutions, Parlance, C-Quadrant Corp., e-PLDT, Convergys, RHM Teleservices Asia Pacific Inc., E-Performax Contact Centers Corp., Sykes, C-Cubed, People Support, among others.
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