The efforts exerted by the Bangko Sentral ng Pilipinas to offset the valuation of the Peso were recently lauded by the business process outsourcing (BPO) sector and other exporters in the country. However, they said the seven percent gain last year made them less attractive to investors as their rates became more expensive.
During the end of 2011, the peso-dollar exchange rate was at P43.84, and last year, it closed at P41.05:$1.
According to a BPO group executive, investors might take their business elsewhere if the peso strengthens further. In line with that, the head of the Export Development Council said some providers are preparing for future peso gains by making contracts more flexible.
Meanwhile, Senen Perlada, Executive Director at the Export Development Council, said some exporters avoid long-term contracts. Key personalities in the BPO and export sector said what matters most is the quality of the services and its value to the investors, so that if the peso becomes stronger, they will still be a reasonable choice.
Notable personalities from Moody’s Investors Service recently shared their insights about the current state of the economy of the Philippines.
One of the debt watcher firm’s divisions said the country is a "rising star" in a depressed global economy. They also said if improvements in business and governance policies continue, the country can mature by eight percent by 2016.
Meanwhile, Glenn Levine, Senior Economist at Moody’s Analytics, said the Philippines could post between 6.5 percent and 7 percent growth this year up to 2014, both hitting the projected figures of the government.
He added that the Philippines already had accessed easy opportunities but if reforms continue, the country could achieve a growth rate of eight percent by 2016.
The current administration’s projections vs. medium-term targets are 6-7 percent for 2013, 6.5- 7.5 percent next year, 7-8 percent in 2015, and 7.5-8.5 percent three years from now.
Moreover, Levine said the increased spending of the government on infrastructure and office space can lead to "sustainable" growth.
The business process outsourcing (BPO) sector is predicted to counterbalance some weakening exports such as the trade of electronics, which posted a drop of 9.4 percent.
Another concern is the struggling inflation environment of the Philippines that has prompted the Bangko Sentral ng Pilipinas (BSP) to exert extra effort in reinforcing the flagging lending activities and improving growth.
For this year’s first quarter, inflation is at 3.2 percent, which is almost at the bottom of the 3-5 percent projection of BSP for the year. In line with that, consumer prices increased at an average rate of 3.2 percent last year and the overnight borrowing rate is at its lowest with 3.5 percent.
However, the recent investment grade rating upgrade from Fitch Ratings was cited to be the Aquino government’s "greatest achievement".
by: Sarah Joson
In a report done by sourcing advisor Alsbridge plc, it was revealed that 76 percent of IT executives are considering changing the terms of their outsourcing contracts. It was also found that 26 percent are unhappy with at least two of their ITO contracts, 40 percent are still waiting for the confirmation of the details after signing the deals, and 47 percent said they often have disagreements with IT providers during renegotiations.
Meanwhile, amidst the fewer number of dissatisfied IT leaders, there are some who are searching for better deals.
One of the reasons for the dissatisfaction is the countless conditions that were soon found to be ineffective. Meanwhile, others said they want to change the contract to keep up with the trends in technology.
Also, during the course of the outsourcing contract, the client will end up paying more than what is initially allotted for the contract. Revenues were likewise seen falling short, which is usually seen in the public sector.
Even with the large number of unhappy customers, outsourcing is still considered as an effective tool as 53 percent said they will renegotiate and only one fourth plan to switch to a new supplier. However, 61 percent were unsuccessful in renegotiating with their existing provider.
Philippine exports are poised to surge 10-17.2 percent this year, even after the decline in February. Merchandise exports are predicted to increase by 10 percent, according to Zeno Ronald Abenoja, Director of Department of Economic Research of Bangko Sentral ng Pilipinas.
Abenoja said sales of Philippine produce overseas are predicted to increase by 18.6 percent while coconut products will grow by 16.2 percent. Machinery and transport equipment, on the other hand, is expected to increase by 12 percent while a 10-percent growth rate is seen for electronics and furniture and fixtures.
Meanwhile, reports show a 7.6-percent growth in Philippine merchandise exports from $48.30 billion in 2011 to $51.99 billion last year.
Business process outsourcing (BPO), information technology (IT), and IT-enabled services are seen as key growth drivers for services exports.
Other studies show that the IT-BPO industry of the Philippines will post a 20-percent growth this year, and contribute $16 billion in revenues.
A pre-labor day program was recently held by the Department of Labor and Employment (DOLE) and Technical Education and Skills Development Authority (TESDA) where they offered job-skills matching and career assessment services to over 300 technical-vocation (tech-voc) graduates.
The event also covered a pre-registration activity for the upcoming Labor Day 2013 Grand Jobs Fair.
Tyron Somera, Human Resource Recruitment Manager of BPO company SITEL and Judith Adina of the University of Cordilleras were some of the speakers. Somera discussed application and recruitment tips while Adina tackled 21st century skills that are crucial for potential employers. On the other hand, George Lubin, DOLE Baguio/Benguet Focal Officer, talked about employment opportunities locally and abroad.
Meanwhile, Henry John Jalbuena, Regional Director of DOLE-Cordillera, cited the ruling of Labor and Employment Secretary Rosalinda Dimapilis-Baldoz that the DOLE group is working hard to provide tech-voc graduates with the necessary information to land the right job. They will also assist the applicants in matching their skills to the right job position.
Jalbuena added that on the Labor Day event, applicants will already know which institutions are looking for the actual skills that they have. About 45 employers will take part in the event, which will mean over 6,000 job openings.
According to the Philippine Software Industry Association (PSIA), the growing information technology (IT) sector of the country is becoming a feasible option for Filipino IT experts working abroad to come home.
Joey Gurango, PSIA Vice-president and Chief Executive Officer of Gurango Software Corp., said it is quite astonishing how IT-BPO firms that have established operations in the Philippines are hiring numerous Filipino IT-experts. Furthermore, the compensation and benefits that are offered abroad are now made available to local IT experts.
During his interview with BusinessMirror, Gurango noted that IT-BPO firms that are planning to set up shop in the Philippines prefer Filipinos as they are able to adapt easily.
Meanwhile, Labor Secretary Rosalinda Baldoz urged students to see the opportunities in the IT and creative sectors that usually offer salaries ranging from P35,000 to P70,000 a month.
According to the report released by the Information Technology and Business Process Association of the Philippines (IBPAP), the Business Process Outsourcing (BPO) sector of the Philippines remains strong and was seen surpassing set targets last year. Moreover, revenues increased 18 percent from $11 billion in 2011 to $13 billion in 2012. Jobs also grew 21.8 percent from 640,000 (2011) to 780,000 (2012), and is projected to reach 926,000.
The 2016 BPO Roadmap created by the local administration aims to reach $25 billion in revenues and 1.3 million jobs. With the prediction of reaching $14.7 billion in revenues and 816,000 jobs by 2016, the call center sector is anticipated to lead the entire BPO industry.
Meanwhile, banking, financial, and healthcare sectors are the key segments seen contributing to the robust BPO growth. Last year’s year-end revenues from the healthcare segment amounted to $430 million and the large medically-skilled and qualified workforce is said to be a huge factor for its growth. Some of the jobs in the healthcare outsourcing segment are data management, medical transcription, medical coding and billing, and pharmaceutical benefit management.