BPOs still confident amid looming US protectionism

By Justine Irish D. Tabile, Reporter

THE information technology and business process management (IT-BPM) industry said that it remains confident in its prospects despite the threat of possible US protectionism under President-elect Donald J. Trump.

In a statement on Tuesday, the IT & Business Process Association of the Philippines (IBPAP) described the Philippines as a resilient outsourcing destination.

“The Philippine IT-BPM industry is built on the foundation of Filipino resilience and excellence,” according to Jack Madrid, IBPAP president and chief executive officer.

“New foreign policies and global movements challenge us, but they also push us to elevate our capabilities,” he added.

The group was addressing “geopolitical shifts and movements like the potential protectionist policies from Mr. Trump, wars and conflicts, and their possible impact on the Philippine IT-BPM industry.”

According to Mr. Madrid, the IBPAP “continued to grow during (the first Trump administration)” regardless of the rhetoric.”

Dominic Vincent D. Ligot, founder of Cirrolytix and IBPAP’s AI, technology, and research consultant, said that 70% of the members of the industry group are North American.

“This number is from IBPAP, which pretty much represents the entire industry,” he said in a Viber message.

Within the industry, he said IT-BPM firms have North American clients such as Teleperformance, Concentrix, Alorica, Accenture, and Sitel Group, while also North American companies also have local operations, which include Wells Fargo, American Express, J.P. Morgan Chase, and Bank of America.

Between 2003 and 2021, 395 US firms invested $22.4 billion in the Philippines, of which 35%, or $7.8 billion, went to IT-BPM, the Center for Strategic and International Studies said in a report.

However, GlobalSource Country Analysts Diwa C. Guinigundo and Wilhelmina C. Mañalac said that Mr. Trump’s “America First” protectionism is designed to ensure jobs for Americans, which could negatively impact the business process outsourcing (BPO) industry.

“The uncertainty of the Trump policy on the business contracting industry could therefore have non-trivial effects on the Philippines’ output growth and employment,” they added.

This year, IBPAP expects export revenue and headcount of $38 billion and 1.82 million by the end of the year.

According to IBPAP’s roadmap, the industry is targeting 2.5 million in staffing and $59 billion in revenue by 2028.

Asked to comment, Foundation for Economic Freedom President Calixto V. Chikiamco said it is too early to tell whether Mr. Trump will impose protectionist measures on outsourcing services.

“President Trump has so far only declared, across the board, tariffs on imports, not on outsourced services. So, we don’t know it yet, but he might, given his ‘America First’ instincts,” Mr. Chikiamco said via Viber.

“So far, he has focused on bringing back home manufacturing jobs back to America, but he may yet zero in on service jobs that have left the country for abroad,” he added.

Despite the positive outlook, Mr. Madrid said that the industry must consistently upskill its workforce in artificial intelligence, data analytics, and cloud solutions.

“By consistently and urgently upskilling our workforce in emerging fields, we ensure that the Philippines remains an indispensable partner in the global IT-BPM landscape,” he said.

According to IBPAP, global demand for IT-BPM services continues to grow as companies continue to rely on outsourcing.

“Companies rely on outsourcing to drive efficiency, scalability, and innovation — needs that transcend political borders,” the industry group said.

“The Philippines stands at the forefront of meeting these demands, thanks to its highly skilled, adaptable, and culturally attuned workforce,” it added.

“The future of the Philippine IT-BPM industry will not be dictated by external policies or global uncertainties. It is defined by the strength of our people, our adaptability, and our unwavering commitment to delivering world-class services,” he added.