Security concerns plague IT-BPM sector

MANILA, Philippines - Concerns over the country’s security have now become the  new normal for foreign investors looking at the Philippine information technology and business process management (IT-BPM) industry, the head of the IT and Business Process Association of the Philippines (IBPAP) said.

This emerging trend is a shift from the previous trend wherein uncertainties in government policies were the utmost concern of foreign investors in this sector.

“It becomes a question and has become a normal on my day-to-day meetings. Every week I host two to three either investor or investor analysts and they come to ask me all of these things, and the recent topic that they asked me is the security. It cannot be avoided in the conversation and its really unfortunate that that has happened,” IBPAP president and chief executive officer Rey Untal said.

“I hope we can get over that quickly and we can go back to just doing business and all of those noises go away,” he said.

Untal was referring to incidents that include the clashes between Filipino government troops and Islamist militants in Marawi City which has led President Duterte to declare martial law in Mindanao since last May 23, as well as  the Resorts World Manila attack last June 2 that resulted to the death of at least 37 people.

The IBPAP head said the unfortunate incidents again brought anxiety to investors who are already starting to move on from earlier setbacks caused by Duterte’s rhetorics and US President Donald Trump’s “America first” pronouncements. 

“Late last year as we all know, our administration had its rhetorics. I think for a while the stance was anti-Obama. Eventually the Trump administration also had their protectionist stance. So based on stories shared to me by colleagues and people I meet with, around that time, there was really a wait and see attitude,” Untal said.

“The good news is when I joined (IBPAP) in May, I started hosting meetings with investors and also met with my member companies. The tide was changing. You saw growth was happening, although arguably not as fast as many years ago. So that’s good news,” he said.

Untal said the recent security incidents were not only very unfortunate, but also not “very healthy” for the industry which is considered as one of the country’s biggest job generator.

“Although the Marawi incident is isolated and far from Metro Manila, we do want to see it over with soon so we can go back to business as usual especially for our investors,” he said, noting that despite their prevailing security concerns, foreign businessmen remain confident and are generally bullish in their investment prospects in the country.

“In the meantime, we are also partnering with local government units there, especially in locations in Mindanao where we have member organizations working. The good news is up until now, for them it’s business as usual like in Cagayan de Oro and Davao where we have presence,” Untal said.

IBPAP came out in October last year with Roadmap 2022, an aggressive six-year program that will chart the growth path of the industry in the next six years.

Under the roadmap, the local IT-BPM industry aims to generate revenues of $38.9 billion by end-2022 from an expected revenue of $25 billion by end 2016.