CIPC: Cebu gains global interest as premier BPO investment hub

CEBU, Philippines - Cebu has further gained the interest of the world’s outsourcing and offshoring (O&O) community after showcasing its capacity worthy to be deemed as a premier destination for global outsourcing services.

Cebu Investment and Promotions Center (CIPC) managing director Joel Mari S. Yu, in a recently concluded two-day Outsource to Latin America and Caribbean (02LAC) Conference, presented Cebu’s capability to host giant and high-quality outsourcing companies from all over the world.

Held in Montevideo, Uruguay, Yu was able to present Cebu’s BPO or the O&O booming sector as well as the province’s wide advantages as a premier investment destination. The conference was attended by over 400 delegates from more than 15 trade and investment agencies in the Latin American and Caribbean regions.

The two-day conference hosted by the Inter-American Development Bank (IADB), the Uruguayan investment promotion agency (Uruguay XXI), and services globalization advisory firm Tholons, opened discussions about global trends in the services globalization industry, aimed at further identifying growth opportunities in the global market.

Yu presented the Cebu City story, highlighting significant findings from the Cebu City IT-BPO Roadmap done in partnership with Tholons.

He emphasized that while Cebu City had a population of less than 1 million people, it was able to develop its local outsourcing industry capabilities through strategic local government initiatives and in conjunction with strong industry-academe partnerships, focused on the development of local talent.

From around 1,200 employees and four service providers in the early 2000s, Cebu City today is home to more than 100 service providers and more than 65,000 outsourcing employees - having skills exceeding that of international industry standards. It is this ongoing success story which generated widespread interest during the conference as most Latin American and Caribbean cities were able to relate to the scale limitations of a midsized location such as Cebu City.

Cebu’s participation in the said conference not only validates the capabilities of the Philippines in the services globalization space, but also champions city-centric and city-driven development, serving as a viable case study for mid-sized locations around the world and including the Latin American and Caribbean Regions.

Considered as one of the strongest economic boosters, the Information Technology and Business Process Outsourcing (IT-BPO) sector, is seeing a more robust year, as the industry projects at least US$11 billion in revenues in 2011.

Meanwhile, the Business Processing Association of the Philippines, with its government counterpart, the Commission on Information and communications Technology (CICT) expects 2011, as the “turning point” year to make the Philippines the premier destination for outsourcing investments in the world, to snatch the position of our popular sites such as India.

“The key to achieving the US$11 billion goal is aggressive marketing both locally and internationally. We have to increase the awareness of our potential employees of job opportunities in IT and BPO companies, including those in the knowledge process outsourcing and other non-voice sectors,” said BPAP chief executive officer (CEO) Oscar Sañez.

Sañez said that the sector is also geared at improving its international visibility to market new services in new territories.

The US$11 billion expected revenues for 2011, is a 20 percent increase from 2010’s estimated revenue of US$9 billion.

BPAP and CICT also projects that the industry could create an additional 84,000 jobs in 2011, bringing the total number of IT-BPO workers in the Philippines to around 610,000.

The positive outlook for 2011 is re-enforced following the international consultant Everest Research declared the Philippines as number one global destination in the voice BPO services sector and measured its yield at US$5.7 billion in revenues compared with India’s US$5.58 billion in 2010.

In the next five years, the global non-voice services sector (including such services as financial services, health care, legal outsourcing, animation, and game development) is expected to grow by as much as 25 percent a year, while the voice BPO market is expected to double in size to US$50 billion.