CITING global recovery and resiliency of the local economy, two global information technology service providers are mulling of expanding their operations to Cebu.
UST Global, an outsourcing company specializing in software development, voiced its optimism on the island-province as the company wants to hire between 3,000 and 5,000 people there in the next two years.
“We are looking at Cebu as an expansion area because of its strategic location and perhaps a good number of qualified employees,” said UST Global CEO Sajan Pillai during the press launch of its second facility in the country in Taguig City.
The McKinley Hill facility is said to cater to its 2,000 clients in North America and Europe.
Pillai said UST Global would increase employment at the $16-million Taguig site up to 1,000 people in the next 12 months.
Employees in these two Philippine centers would develop and maintain software, and provide infrastructure support to six retail giants in the US and Europe, the executive said.
Joe Nalkara, president of UST Global, said in a separate statement that it has invested in the Philippines to take advantage of the country's highly skilled IT workforce.
“We zeroed in on the Philippines because of the highly skilled and refined work culture we've observed here. This is a perfect match with the style of functioning we follow elsewhere in our centers,” Nalkara said, adding it partnered with University of Santo Tomas (UST) for industry-school collaboration on IT development.
Pillai said growth prospects are pegged at 40 percent this year, almost double than its 23 percent showing in 2009, a recession year.
He added that the government should be serious in providing better infrastructure and tax incentives for business process outsource (BPO) investors.
Cybernet-Slash Support Philippines Inc. also expressed confidence on Cebu's business climate in a parallel media launch of its 1000-seat service delivery unit in the Philippines.
“Cebu has been an attractive point for investors and as we all know, some contact centers have already started shifting their operations there,” said Senior Vice President and Head of Consumers Services Raghu Rahman in a separate interview.
Data from the Philippine Economic Zone Authority (PEZA) said the Philippines has a total of 788 major call centers spread across 20 locations nationwide, 44 of which are in Cebu.
$9 billion-revenues from BPOs
President Gloria Macapagal-Arroyo attended UST Global's event as part of her week-long legacy tour of cyber corridor.
The Cyber Corridor, together with the North Luzon Agribusiness Quadrangle, Luzon Urban Beltway, Agribusiness Mindanao and Tourism Central Philippines, comprises Arroyo’s Super Regions program that was launched in 2006.
The cyber corridor is set to provide ICT (information and communication technology) investments in the following areas: call centers, back office, software development, medical transcription, engineering design, animation and game development.
Martin Crisostomo, external affairs director of Business Processing Association of the Philippines (BPAP), told Sun.Star that the BPO industry will likely hit a 26 percent growth this year, higher than the 20 percent uptick in 2009.
The Philippines currently ranks second to India in the global BPO space with over 400,000 personnel as of last year.
Crisostomo added that revenues might breach the $9 billion-mark for 2010 from $7.3 billion in 2009.
In the next two years, BPAP is grooming 50 next-wave cities such as Cebu, Iloilo and Davao City to create about one million BPO jobs nationwide with revenues between $11 billion to $13 billion in revenues.
BPAP groups 240 of the more than 600 companies in the IT-enabled sector. (Virgil Lopez/Sunnex)