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Outsourcing News for January 2016 | MicroSourcing

Tier-3 Cities in the Philippines Attracts BPO investors

According to a report “2016 A.T. Kearney Global Services Location Index (GSLI)” done by consulting firm A.T. Kearney, the labor supply in the Philippines’ tier-3 cities keeps it at the seventh spot as the most attractive country in the world for outsourced services.

The report read that the Philippines and India are still the go-to countries for offshoring, but business process outsourcing companies are now considering companies outside of the major cities to tier 3 locations. For instance, in the Philippines, they are now looking at Bacolod and Iloilo City for new talent.

The Philippines also has the leverage of its talent’s soft skills that cannot be replaced by machines. This can then be combined with the traditional business process outsourcing (BPO) skills.

Fifty-five countries were surveyed in the report and the Philippines maintained its 7th place with a total score of 5.88 out of 10. The study had three major categories, with Manila posting a score of 3.17 on financial attractiveness, 1.43 on people skills and availability, and 1.29 on business environment.

The first six are India (6.96), China (6.49), Malaysia (6.05), Brazil (6), Indonesia (5.99), and Thailand (5.92).

The report also stated that in the global outsourcing space, the Philippines is second to India, which is known for contact center operations and moved to complex processes in BPO and information technology.

It was also noted in the report that the Philippines has improved infrastructure, environment, and tax regulatory costs since 2014.


Philippine Economy Expected to Grow 7 Percent

Philippine Socioeconomic Planning Secretary Arsenio M. Balisacan recently said development and growth will only happen if the country continues to increase investments in infrastructure and develop higher levels of public investments. Moreover, the best angle that could be worked on is investment in human capital or surpassing the capacities of neighboring countries. He added that we should also invest in human resiliency.

Balisacan also said reforms aimed to improve business climate are needed and should be discussed in the next Philippine Development Plan. He pointed out that compared to neighboring counterparts, the country’s infrastructure is subpar and needs to be improved immediately. The economic planning chief said if these fundamental constraints as well as energy-related issues are addressed properly, we could see a growth of seven percent in the next five years.

Energy is also a factor that should be looked into because according to Balisacan, it is a foundation for inclusive growth and that its development should not just focus on quantity but also on quality and accessibility. Other segments that need to be deeply invested on are health, education, social protection, and employment.