For how many years now, the Philippines or also known as the “Pearl of the Orient Seas” is recognized as one of the top and ideal countries when it comes to global outsourcing industry. This industry has developed speedily since it covers the elements critical to outsourcing for both service providers and customers. To name a few, these comprise large-scale people resources, with an estimate of half-a-million English-speaking students graduating from colleges and universities yearly, interpersonal warmth, a richly deserved reputation for excellence in communication skills, customer-service orientation, problem-solving capabilities, and cultural affinity with Western markets and customs, and an operational cost advantage, with costs competitive with any supplier country in the world.
Here are the main reasons why the Philippines became the Asia’s Ideal Outsourcing Hub.
First, it is because of its “People Power.”
The Filipino workforce is known to be one of the most undeniable advantages the Philippines has over any other Asian country. With superior education priority, the literacy rate in the country is 94.6% – among the highest. English is taught and trained in all schools, hence the Philippines is considered to be the world’s largest English-speaking country. Every year, there are some 350,000 graduates inspiring and aiming the professional pool.
Second, it has something to do with its “Strategic Business Location.”
The Philippines is situated right in the heart of Asia which is nowadays, the fastest and best growing region. It is positioned within four hours flying time from major capitals of the region. Sited at the crossroads of the eastern and western business, it is a critical entry point to over 500 million people in the ASEAN marketplace and a gateway of international shipping and air lanes suited for European and American businesses.
Third, it is because of the “First-class Lifestyle” of the Filipinos.
Discover and see the best of sun, sea, sand and style in the tropical setting packed with the most excellent western facilities. The Philippines is considered to be the second home of expatriates who enjoyed the company of the warmest people in the region, the country’s directness to varied cultures and an unquestionably global outlook. Expats take pleasure in reachable and affordable luxuries – business centers, housing, schools, hospitals, shopping malls, hotels and restaurants, beach resorts, and recreation centers.
Fourth, the Philippines has “Abundant Resources.”
An archipelago like the Philippines presents varied natural resources, from land to marine to mineral resources. Moreover, it is the biggest copper producer in Southeast Asia and among the top ten manufacturer of gold in the world. Likewise, it is the home to 2,145 fish species, four times more than those found in the Bahamas. The 7,100 islands possess and boast of stunning beaches and magnificent sceneries that offer comforting leisure and relaxation spots for vacationers and tourists.
Fifth, the Philippines has a “Low Cost of Doing Business.”
Regarding the wages, they are naturally less than a fifth of that in the U.S. Local communication, electricity and housing costs are also 50% lower compared to the U.S. rates. Hence, foreign companies that are currently outsourcing programming and business processes to the Philippines enjoy this advantage. There is an estimate of 30 to 40% business cost savings, 15 to 30% call center services and application systems and 35 to 50% software development.
Sixth, the Philippines has “Liberalized and Business-Friendly Economy.”
The Philippines has an open economy and it permits one hundred percent foreign ownership in approximately all sectors and supports a Build-Operate-Transfer (BOT) investment scheme that other Asian countries emulate. Government corporations are privatized and the banking, insurance, shipping telecommunications and power industries have been deregulated. Incentive packages comprise the commercial income tax, condensed to a present 32%, with companies in the Special Economic Zones are subject to only 5% overall tax rates. Multinationals finding and searching for regional headquarters are allowed to incentives such as tax exemptions and tax and duty-free importation of precise equipments and materials.
Seventh, it has “Unlimited Business Opportunities.”
As Asian economies incorporate within the huge framework of the ASEAN Free Trade Agreement (AFTA), the Philippines is the customary and most considered location for firms that want access to the huge ASEAN market and its gigantic trade opportunities making the Philippines to be the Asia’s ideal outsourcing hub. This country has improved and primed up various areas for investors and tenders a dynamic customer market accustomed to an array of product alternatives formed and created by a competitive domestic economy.
Eighth, it is due to its “Developing Infrastructure for Global Growth.”
An intense and well-developed communication, transportation, business and economic infrastructure link the three main islands and distinguish the Philippine economy. Extremely available by air, water and cyberspace, liberalization of inter-island shipping and domestic aviation additional sparked improved facilities and services. The container terminals are right to handle cargo traffic at the uppermost levels of efficiency.
Communication offers redundant international connectivity 24/7 with fiber optic cable as main backbone network and satellite as backup. Economic reforms highlight regional expansion, converting remote areas into business centers. The landmark BOT legislation permits private investors to construct and operate infrastructure, then turn it over to the Philippine government right after a set period of time.
Lastly, here are the final statements.
The Philippines offers state-of-the-art world-class telecommunications facilities, sufficient and never-ending power supply. There are ready-to-occupy offices and production facilities, computer security and building monitoring systems, as well as absolute office services in specialized IT zones. With the government’s aim and focus on building up an IT-enabled economy, it is without a doubt that the Philippines is on its way to flattering and becoming the E-services Center of Asia.