BPO sector, govt agree they can’t carry economy

Officials of the business process outsourcing (BPO) sector as well as the government have agreed with the Asian Development Bank’s (ADB) observation that the sunshine industry on its own cannot drive the country’s economic growth.

During a telephone interview, Oscar Sañez, Business Processing Association of the Philippines (BPAP) president, said that “the BPO industry cannot carry the whole country.”

“It is quite understandable, what the ADB was saying is [the country] cannot just rely on one industry,” he added. “If you want to support the chair, you need more legs.”

In a recent policy note, the ADB said that while the BPO sector is boosting domestic consumption because it has generated jobs for many Filipinos, “it is not realistic to believe that the BPO industry can allow the economy to leapfrog the process of industrialization.”

In a text message, Trade Secretary Gregory Domingo said that the BPO sector “maybe [cannot] leapfrog industrialization, but they can at a minimum co-exist with each other and most likely even complement each other.”

The Department of Trade and Industry has identified the BPO industry as one of the six sectors that would enjoy government support because of its high growth potentials in the next six years.

The other high-growth industries identified by the Trade department are electronics, tourism, mining, housing and agriculture.
Sañez said that the BPO sector also needs support from other industries such as logistics, infrastructure, transportation and telecommunications.

The BPAP head added that the government has “a big role” in making these important sectors grow at the same time.

“It’s now the government’s turn to respond to the needs of the strategic industries it identified,” Sañez said.

BPAP had forecast that the Philippine BPO industry’s revenues this year would reach about $9 billion, or about 26 percent higher than last year.

Under BPAP’s IT-BPO Road Map 2011-2016, the sector targets to triple its revenues to $25 billion and employment to 1.3 million in six years.

The industry aims to make up 9 percent of the country’s gross domestic product (GDP), as well as corner a tenth of the global outsourcing business by 2016.

GDP represents the amount of goods and services produced locally in a year. –Ben Arnold O. De Vera, Reporter, Manila Times