“The BPO [Business Process Outsourcing] industry has come a long way from its humble beginnings as a single call center to the mammoth it is today. Only the best is yet to come,” said CB Richard Ellis (CBRE) Philippines founder, chairman and chief executive officer Rick Santos.
CBRE is the leading real estate advisory & services firm in the country. The firm cites the Philippines as one of the best outsourcing destinations in Asia as its latest research indicated the country is competitively priced as far as property prices are concerned.
Speaking in a press briefing held in Makati City, Santos stated, “The Philippines is one of the most cost effective real estate markets in Asia. For instance, it is significantly less expensive than Hong Kong and Singapore which is around 12 times more expensive. This is also why demand in the office services sector in terms of business process and knowledge process outsourcing has been growing in the country. This year’s projected take-up of office space in Manila is anywhere between 330,000 and 360,000 square meters which is quite large when compared with Singapore’s 150,000 square meters a year. We see continued expansionary demand from multinational companies as there is good value in the Philippine real estate market.”
Most Preferred Outsourcing Destination
Santos also alluded to Manila’s (Capital City of the Philippines) current position as the world’s second most important place for outsourcing, as listed in the latest Tholons’ Top 100 Outsourcing Destinations, and the presence of seven other Philippine cities – Cebu City, Davao City, Sta. Rosa (Metro Laguna), Bacolod City, Iloilo City, Baguio City, and Metro Clark.
He also believed that the country is the “bright spot of Asia” and is poised to be the BPO capital of the world as the industry has contributed immensely to the growth of the national economy during the past decade, even creating a market of 1.3 million jobs by 2016 and an annual growth of 17 percent. “Since we started 20 years ago, the Philippines is now at its peak. We can be considered the call center capital of the world, and this speaks volumes of our success story as a nation,” Santos stressed.
Moreover, he also believed that even the cities outside of Metro Manila can expect continuous growth as more BPO companies are looking to tap other competitive areas in what CBRE calls as “next wave cities.”
“We are optimistic on the movement of the real estate market, as more investors are flocking in to take part in the opportunities outside the major CBDs [central business districts] like Clark, Iloilo, Davao, and Cebu. The playing field is much more exciting now with the creation of developer and investor-driven CBDs and the strong momentum of the BPO sector in the coming years,” stated Santos.
Fitch Ratings announced last week that it has upgraded the Philippines’ credit rating to “Positive,” citing the country’s external finances as a key contributor to its credit strength. “The Philippines has run current account surpluses since 2003, underpinned by high levels of worker remittances and revenue from the business process outsourcing industry,” said the credit watcher.
Jason Escartin of F. Yap Securities Inc. also referred to the latest revision on the country’s outlook as an attractive factor for investors to reconsider the country’s strong current account surplus, anchored on proceeds from the industry of outsourcing in the Philippines.
Improved Global Competitiveness
Furthermore, the country climbed five notches in the latest World Economic Forum (WEF)’s Global Competitiveness Index, the annual ranking on how institutions, policies, and other factors affect the level of productivity of a country. The Philippines also got the highest ranking in terms of macroeconomic environment followed by market size and business sophistication.
The sustained growth of the industry of outsourcing in the Philippines reflects the country’s stronger economy. With these overwhelming figures, we likewise believe that this is just the beginning of more favorable outcomes for this thriving industry in the country. Start building your offshore team here today.
The Outsourced Accountant supports Australian and New Zealand accounting firms by helping them understand and implement outsourcing solutions to help them become more proactive and truly add value to their clients. If you want to know more about outsourcing, call us at 1300 896 522/0800 452 853, and download our e-book.