Philippines remains competitive as BPO destination — Chua

MANILA, Philippines — The Philippines would remain as an attractive destination for business process outsourcing (BPO) post-pandemic due to competitive wages and a mature BPO sector, acting Socioeconomic Planning Secretary Karl Chua said.

Interviewed on The Chiefs aired on One News Thursday night, Chua said despite the possibility that more multinational firms may onshore their operations to bring back jobs to their countries, they will still put a premium on cost competitiveness and higher returns.

“The minimum wage here (in the Philippines) is $10 per day or less than two dollars per hour. The minimum wage in those countries that are attempting to bring them back is $8 per hour. So by that you start to wonder whether those plans will really happen. Maybe yes, maybe no,” Chua said.

“The truth now is, everything now is about productivity where you can have higher returns and you can lower the cost. Those are the things that companies should think about. And I haven’t seen those things even during those times when countries were trying to bring back jobs.”

The Philippine BPO sector, he said, has matured over the years and has gained a good reputation among investors.

“BPOs are very diversified and we have built a brand name,” said Chua.

As restrictions to mobility caused by the COVID-19 pandemic disrupt business operation worldwide and plunge economies into recession, multinational firms have been reshoring operations or moving business operations to countries where they have competitive advantage.

“So it’s really about being realistic, where the market will give you the highest returns,” Chua added.