Government urged anew to rethink BPO incentives

CEBU, Philippines - Global outsourcing giants are reiterating their call on the government to incentivize the BPO companies in order to keep up with the competition.

Jibin Arjunan, Wipro regional head for Asia Pacific and Japan said that the Philippines has to do some policy revamp or introduce new policies to lure more outsourcing companies in the country, at the same time encourage existing global firms to expand their operations.

Wipro, one of the largest outsourcing companies in the world based in India, believes that the English fluency of Filipinos is the key advantage. However, this edge should be complemented with solid and effective policies for the global investors.

Arjuanan suggested that part of the country's "must do" jobs to sustain the robust outsourcing growth is to immediately respond to the fast growing and evolving outsourcing requirements.

Differentiation perspective is just one of the angles that should be looked into by the Philippines, otherwise, other countries within the ASEAN or in other parts of the world may snatch the Philippines' bigger pie in the outsourcing business.

This early, although Wipro is optimistic of its expansion route in the Philippines, the company has sensed a limitation of good talent supply, especially in Cebu and the Visayas.

"Cebu lost a lot of [good] talents to Luzon. Cebu should get these people back," he said.

Already, the BPO sector in the Philippines had been proposing for incentive possibilities such as extending the number of years of income tax holidays.

Earlier, Alejandro Melchor III, deputy executive director of the ICTO of the Department of Science and Technology, said the government must look into offering more incentives in order for the country to compete with other countries trying to attract IT and BPO investments.

“Now is the time to give more incentives on the table because locators are looking at us,” Melchor said.

In new wave cities or emerging locations for IT-BPO businesses in particular, he said the local government units must work with the ICTO in order to come up with an incentives package that would attract such firms to invest.

The next wave cities identified by the BPAP and ICTO in its report were Davao City, Sta. Rosa City in Laguna, Bacolod City, Iloilo City, Metro Cavite, Lipa City, Cagayan de Oro City, Malolos City, Baguio City and Dumaguete City.

Melchor noted that Malaysia for instance, is offering investors an eight-year tax holiday to lure investors in their country.

The Philippines, Melchor added, must consider extending the current income tax holiday offered for six years to at least eight years to remain an attractive destination for IT and BPO investments. (FREEMAN)