O&O sector expects big investments from Europe

The government together with the Business Process Outsourcing Association of the Philippines (BPAP) wants to attract more European investments in the outsourcing and offshoring (O&O) sector.

“We will be going on a trade mission to Germany and the United Kingdom in October,” BPAP president Oscar Sanez told The Star in an interview.

According to Sanez, the trade mission will be done in coordination with the Department of Trade and Industry (DTI) and the Department of Foreign Affairs (DFA).

In Germany, Sanez said they will be talking with their German counterpart BITCOM. Sanez said they are still in the process of confirming meetings with German information technology (IT) companies for possible investments in the country.

Early this year, BPAP attended a trade mission in Australia which could result in the doubling of the Philippines’ share in the Australian market.

Sanez said the offshoring industry in Australia is virtually untapped with only 12 percent of the companies involved in outsourcing.

Majority or eight percent is cornered by India while the Philippines enjoys only a three percent share. “We can definitely increase our share by six percent within the year,” Sanez noted.

Aside from new companies entering the Philippine market, Sanez said two existing Australian firms will expand their presence here.

“Stellar and Admerex, both of which entered the country late last year, are planning to increase their call center and back office operations here,” he reported.

Stellar operates 18 outsourcing centers around the world that collectively employ more than 6,000 staff and manage over 300 million customer interactions and 100 million transaction processes every year.

Admerex Limited’s principal activities are marketing, licensing, supporting, developing and investing in software solutions and receivables managenent centers for the banking and financial services, telecommunications and utilities industries and the provision of receivables and risk management consulting services.

Sanez, together with 20 Filipino companies, visited Sydney and Melbourne Australia where they met 35 companies interested in coming to the Philippines.

In fact, five companies have already scheduled their visits to the country.

Sanez described the firms as midsized which are interested in back office, finance and information technology.

Sanez said BPAP has forged a partnership with the Australian Information Industry Association (AIIA) for a joint exploration of investment opportunities.

The AIIA is the Australian counterpart of BPAP.

Sanez said the only concern of Australian firms in the country is the sustainability of labor.

In Australia , there is a shortage of labor specifically in the IT industry. This has caused the increase of wages.

“This is why Australians are looking at outsourcing in order to cut their costs,” Sanez said.

Average wage in Australia is bigger than in the United States. Wage in Australia is $33,000 per year while it is only $24,000 per year in America.