Fall in BPO investments
NEW INVESTMENT pledges in the Philippines’ IT-BPM industry registered through various promotion agencies fell 34 per cent in the second quarter from a year ago, continuing the decline in one of the country’s top dollar earners that the trade chief had partly attributed to the uncertainty in US policy.
Collecting the pledges registered through seven investment promotion agencies (IPAs), data from the Philippine Statistics Authority (PSA) showed that investment commitments in the business process outsourcing (BPO) sector totaled 4.9 billion peso in the April-to-June period in 2017, falling from 6.27 billion peso registered in the same months last year.
The latest figures of the Information Technology and Business Process Management (IT-BPM) industry showed the continued decline in investment pledges. The PSA earlier reported a 34-per cent decrease in new pledges during the first quarter to 4.18 billion peso from 6.34 billion peso in the same three-month period in 2016.
“Perhaps the IT-BPM firms are just taking time in due diligence as well as a wait-and-see approach on the US policy for companies locating offshore,” Trade and Industry Secretary Ramon Lopez told the Inquirer.
Lopez added that there were still “anchor accounts expanding using innovative operating models,” noting that they were retooling the workforce of the IT-BPM industry, also known as the country’s top private sector employer, to use new technology such as systems enabled with artificial intelligence.
This is not the first time that pledges shrank in terms of their growth rate.
According to PSA data, the expansion rate of these pledges had been on a decline since the third quarter of 2016. In spite of a more than 35-per cent increase in pledges during the second quarter of 2016, commitments still finished the full year with a 22.6-per cent decline to 30.74 billion peso from the previous year that had 39.73 billion peso.