Outsourcing is rapidly transforming the Philippine economy. Harvard-trained economist Cielito Habito of the Ateneo de Manila University says the dynamics of this two-billion-dollar business is manifested in the rapid growth of the telecommunications sub-sector of the economy. Dan Sebastian Reyes, the chief executive officer of Client Logic, a call center firm, says that for every job a local BPO provides also creates ten others in complimentary industries like food and beverage, transportation, real estate, telecommunications, banking, among many others. It’s hard to verify this claim but the over P2 billion payroll that these companies provide their employees each month certainly has created a lot of business for a lot of urban services.
Since the last five years, many were wondering why despite all political squabbles, the Philippine economy showed it was capable of growing at 5-6 percent. Some observers were wondering whether or not the Philippine society has a split personality, with its politics always triggering the monstrous Dr Jekyll and its economy showing off a hopeful Dr Hyde. In this region of economic tigers and dragons where 7-9 percent growth is the norm, a 5 percent growth rate is necessarily mediocre. However, for an economy weighed down by negative political perceptions, a 5 percent economic growth, may represent an acceptable definition of the Promised Land. Certainly, the service sector, buoyed by the telecommunications and business services sector of which outsourcing is significant part, is carrying the torch for the Philippine economy in the last few years. (To be continued)