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PH BPOs Express Concern over Strong Peso

by: Sarah Joson

Monday, August 15, 2011 | Outsourcing News |

BPO Service Providers worried over Stronger Philippine Peso

The rise of the peso is worrying the BPO industry, and further appreciation might put off expansion plans of BPO companies.

According to Philippine Chamber of Commerce and Industry (PCCI) Chair Sergio Ortiz-Luis, BPOs need to reformulate business strategies if the exchange rate comes to P40:$1. The exchange rate is currently at P42.50 range. This is six percent higher compared to last year.

Ortiz said in a consultation meeting with the Business Processing Association of the Philippines (BPAP) along with other exporters, “They can still live lower than P42:$1 but a lot of the BPO expansion will be put on hold”. He also said that this will have an impact on the image of BPOs of having a competitive edge during the medium term.

According to a report done by PCCI, BPOs’ labor arbitrage will decline if the peso remains strong, which may cause clients to take business elsewhere. PCCI also conducted an industry study which showed that an exchange rate below P37:$1 will take a toll on the BPO industry’s competitive advantage.

A 20-percent growth valued at $25 billion is predicted by BPAP’s medium-term road map which will begin next year up to 2016.

Source:
http://www.mb.com.ph/

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