US-China trade conflict won’t dent BPO growth

The Business Process Outsourcing (BPO) is seen to sustain its growth as the Philippines remains to be the top tier outsourcing location in the world.

“Outsourcing remains to be one of the most effective ways of managing companies during difficult times as what we saw in the aftermath of the Global Financial Crisis where the Philippines experienced a wave of expansion in the outsourcing industry,” said Colliers International Philippines director for Office Services Dom Fredrick Andaya, referring to the ongoing US-China trade conflict.

Andaya said with the US-China trade war, both countries will experience economic slowdown due to the rising prices in the US and decreasing output (and exports) in China. In the US, this puts pressure on the bottom line of companies across industries.

“We have seen new companies setting up in the Philippines in the past six months, with several more looking to establish their presence in the country. The main attraction is still the Filipino talent which showed adaptability and resiliency in light of the upskilling requirement of the outsourcing industry,” Andaya added.

Colliers has observed that some of these companies want to; test the waters first by starting small in a flexible workspace, then expand after a few months; Sign up in a flexible workspace to set-up and conduct hiring while doing the site selection for a permanent space.

On the other hands, Andaya believes there are certain issues that the Philippine government needs to resolve to ease the uncertainty that potential clients are facing. These include uncertainty regarding the provisions and approval of Tax Reform Package 2 or the Corporate Income Tax and Incentives Rationalization Act (CITIRA).

“We are asking our legislators to immediately resolve Citira concerns so that the companies can take advantage of the opportunities presented by the US-China Trade War,” stressed Andaya.

Citira is the renamed version of the Tax Reform for Attracting Better and High-Quality Opportunities bill that the House had passed in the previous 17th Congress. The Trabaho bill, however, ran out of time in the Senate and had to be re-filed in the 18th Congress.