by: Sarah Joson
Wednesday, March 20, 2013 | Outsourcing News |
According to Paco Sandejas, Managing Partner at Narra Venture Capital, even with cumulative efforts to balance the currency strength, the information technology (IT) industry is struggling along with other major sectors.
He cited during an interview with ANC’s Inside Business that for manufacturing software and electronics, the margins are very narrow. The slightest change in exchange rate, 10 percent for instance, will induce a negative effect. He added that there’s already a five-percent irregularity in the local currency.
Last year, the peso closed at P41.05 a dollar, and recently, it finished at P40.585:$1.
Sandejas explained that the IT sector should look into offering new products and innovation to counter the valuation of the peso.
The peso was also seen appreciating by six percent last year, from 2011’s P43.84 to $1.
Other segments affected by the stronger peso are the business process outsourcing (BPO) industry, exports segment, and has also dampen the spending power of the families who depend on remittances from overseas Filipino workers.
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