IT-BPM investments from Australia
Business Mirror
November 23, 2016
THE Philippine information technology-business-process management (IT-BPM) industry is considered one of the main pillars of the Philippine economy.
This industry has been the major source of service exports, and the main reason the services industry contributes the most to the country’s GDP. The IT-BPM work force in the country numbered more than 1 million people in 2014. It is forecast this industry in the Philippines will expand to employ 1.3 million people and generate $25 billion, or 8 percent, of the GDP by the end of 2016. This industry is one of the fastest-growing industries in the Philippines, developing at a rate of more than 20 percent annually for the past seven years.
The majority of IT-BPM investments are American, but unknown to many, top Australian companies are invested in this industry and their footprint is getting bigger every year.
Based on information given by Austrade in Manila, there are about 200 Australian companies registered in the Philippines. The nine major Australian investments registered with the Philippine Export Processing Zone (Peza) and the Board of Investments already have a combined investment of P6.89 billion. The actual figure of Australian investments in the Philippines could be close to $500 million.
We estimate Australian companies employ about 40,000 Filipino workers in the Philippines across various industries, ranging from mining, shipbuilding, software development, call centers, manufacturing, seaport management, engineering and architectural design, data encoding, accounting and finance, and other business-process services for export.
Australian IT-BPM companies in the Philippines employ Filipinos in call centers and other back-office support type of services doing software development, accounting, engineering design, graphics design, web management and similar services. The number employed by the Australians is more than 30,000 workers. The biggest employers would be Telstra International Philippines Inc. (15,000 workers), ANZ Global Services and Operations Inc. (7,500 workers) and QBE Group Shared Services Ltd. (2,500 workers).
The rest of the Filipino workers would be in smaller IT-BPM companies employing from a few dozen to a few hundred workers. Australian IT-BPM investments in the Philippines contribute at least AU$2 billion of service exports from the Philippines to Australia every year.
The IT-BPM investments from Australia still have the potential to increase due to the Philippines’s having an available, highly educated work force and the high cost of labor in Australia.
We are still seeing growth in Australian companies putting up small- to medium-sized investments in call centers and other back-office operations, such as customer service, sales and order processing, telemarketing, accounting, finance, billing, engineering design, graphics design, and web development and management.
For the past eight years, the Philippine Trade and Investment Center in Sydney has been coorganizing with the Information Technology Business Process Association of the Philippines the country’s participation in CeBIT Australia. CeBIt is the longest-running business-technology conference and exhibition in the Asia Pacific. In this year’s CeBit held in May, we had the participation of 11 Filipino IT-BPM companies that came to Sydney to offer their services to Australian companies.
PTIC-Sydney invited prospective clients to visit the Philippine pavilion and organized the one-on-one meetings for the Filipino companies and potential clients. Every year we also organize a business seminar on the Philippine IT-BPM industry in partnership with Earnst and Young of Australia. At least 40 percent of all investment inquiries from Australia serviced by PTIC-Sydney in 2015 were for the IT-BPM industry, and the trend has been the same for 2016. □
Kenneth T. Yap, Consul (Commercial), Philippine Trade and Investment Center, Sydney