THE PHILIPPINES

IT-BPM PRIMER
CORPORATE AGENCY & BROKERAGE
Philippines: Your Outsourcing Destination
PHILIPPINE Country Statistics
OVERVIEW  Location: Southeast Asia
 Land Area: 115,124 square miles
 Main Islands: Luzon, Visayas and
Mindanao
 Climate: Tropical
With wet and dry seasons
 Time Zone: GMT +8 hours
 Population:
92.34 Million (2010 Census)
103 Million (2014 estimate)
 Labor Force Participation: 63.9% (2013)
 Unemployment Rate: 6% (4Q 2013)

Economic Strengths
 Gross Domestic Product: 6.5% (4Q 2013)
 Inflation: 4.2% (January 2014)
 Currency Unit: Philippine Peso (PHP)
 Currency Exchange Rate: US$1 = PHP44.927 (January 2014)

 BPO Industry Revenues:

US$ 13 Billion
 BPO Employment:
772,000 (2012),
900,000 (2013)
 BPO Projected Revenues:
US$ 16.5 Billion (2014)

Growth Areas
 Strong growth in Infrastructure and Construction
 6 Million square feet of Office space take-up (2012) with insurance and bank-
ing firms expanding within and outside Metro Manila and Healthcare Services
starting to locate in the Philippines
 Gaming Revenues: US$10 Billion (2017), to challenge Macau and Las Vegas
 Target Tourist Arrivals: 10 Million (2016)
 Resurgence of manufacturing and industrial sectors
CORPORATE AGENCY & BROKERAGE
Philippines: Your Outsourcing Destination
DOING 1 Talent Pool
BUSINESS Rich talent pool with over 500,000
IN THE college graduates per year
3rd largest English speaking country
PHILIPPINES in the world
75% of IT-BPO jobs are in Metro
Manila, and yet Metro Manila’s ab-
sorptive capacity is still not fully util-
ized
Metro Cebu, Mactan, and Clark are
now becoming popular lifestyle BPO
sites in the country

2 Reliable Infrastructure
Real Estate: Philippines still offers the lowest prime rent across Asia
Metro Manila and Metro Cebu continue to increase ranking in the top 10
outsourcing destination as the Philippines established delivery destinations
Power: Most buildings in Metro Manila and Tier II locations offer 100% back-
up power
Telco Providers: PLDT and Globe both have Fiber Optic Backbone Network
and TelicPhil is equipped with Nationwide Digital Transmission Network

METRO MANILA
LEASE RATES
(US$/sq. ft.)
CORPORATE AGENCY & BROKERAGE
Philippines: Your Outsourcing Destination
DOING 3 Government Incentives
BUSINESS Philippine Economic Zone Authority (PEZA)
IN THE Board of Investments (BOI)
Bases Conversion Development Authority (BCDA)
PHILIPPINES These government agencies offer investors who are in export-oriented manufac-
turing and service facilities inside selected areas in the country the proper assis-
tance and incentives.
Incentive BOI PEZA CDC/SBMA (under BCDA)

Income Tax Holiday (ITH) 4 – 6 years (max of 8 years) 4 – 6 Exempted from all local and
years (max of 8 years) national taxes - value-added
taxes, franchise taxes, excise and
ITH Bonus 3 years provided the firm meets certain ad valorem taxes)
conditions

Special Tax Rate of 5% on Gross Yes

Income

Importation of Capital Equipment, 0% Duty-Free Tax and Duty-Free

Spare Parts and Supplies

Wharfage Dues and Export Tax, Exempted

Duty, Impost and Fees

Simplification of Customs Proce- Yes

dures

Employment of Foreign Nationals Foreign nationals may be employed in supervisory, technical or advisory
positions within 5 years from a project’s registration, extendible for limited
periods. The positions of president, general manager, and treasurer or
their equivalents, of foreign-owned registered firms may be retained by
foreign nationals for a longer period.

4 Labor Cost Sector

Starting Monthly Salary

in USD
Philippine rates are very com- $365-$410
petitive and considered one of Voice BPO Skilled: $550
the lowest for English voice Non- Voice BPO
and non-voice BPO work
(back office or knowledge process outsourcing) $460-$525

$320-$410

Health Information Management and Care Clinical specialists - $460-$910

Information Technology Outsourcing (ITO)/

Software Development $460-$570

Medical and Legal Transcription $180-$345

Engineering Services Outsourcing (ESO) $340-$410

Animation $910-$1370

Game Development $365-$455

CORPORATE AGENCY & BROKERAGE
Philippines: Your Outsourcing Destination
IT-BPM Major Shared Services Firms in the Philippines
INDUSTRY 1. JP Morgan Chase 849,150 SQ. FT.
2. HSBC 363,400 SQ. FT.
IN THE 3. Shell SSC 304,450 SQ. FT.
PHILIPPINES 4. Thomson Reuters
5. Dell
246,900 SQ. FT.
126,800 SQ. FT.
6. Manulife 113,220 SQ. FT.
7. Deutsche Knowledge Services 304,650 SQ. FT.
8. Chevron 148,550 SQ. FT.
9. Citigroup 89,000 SQ. FT.
10. ANZ Bank 163,800 SQ. FT.
11. Capital One 161,400 SQ. FT.

IT-BPM Industry in Numbers

Estimated % Growth Revenues % Growth
Sector Services
FTEs (2012) from 2011 (2012) from 2011

Inbound and outbound

Voice BPO services, technical support, 497,000 19% $8.7 Billion 18%
customer services

Global in-house centers,

Non-voice/KPO corporate services, Back-office 154,380 20% $2.5 Billion 20%
services

Healthcare Information Clinical data management,

45,000 80% $460 Million 66%
Management Outsourcing legal/Medical transcription

Programming and software

ITO/Software Development development analysis and 57,078 14% $1.16 Billion 17%
design

Designs for civil works,

Engineering Software
buildings, 10,836 20% $206 Million 20%
Outsourcing (ESO)
electronics, etc.

The process of giving illusion

of movement to
Animation 9,000 4% $132 Million 3%
cinematographic drawings or
models thru 2D, 3D

Outsourced services combined

Game Development 3,500 40% $50 M 257%
with IT and creative work

Largest Third Party Service Providers

 Convergys
 Accenture
 Teletech
 Telephilippines
 Sykes
 SPI Global
CORPORATE AGENCY & BROKERAGE
Philippines: Your Outsourcing Destination
IT-BPM BAGUIO (26)
IT-BPM Distribution Map
INDUSTRY  Convergys
 Sitel
 Top Outsource
Performance Inc. METRO MANILA (1000+)

IN THE PAMPANGA (26)

PHILIPPINES
 Cyber City
Teleservices, Ltd.
 Stream
 Teletech

RIZAL (6)
 Teletech
 Mega Callnet, Inc.

CAVITA, LAGUNA,
BATANGAS (20+)
 Accenture
 Convergys
 Teletech
 Sutherland

CEBU (100+)

ILOILO CITY (13)

 SPi Global
 Teletech
 Sutherland

BACOLOD (14)
 Convergys
 Teletech
 TelePerformance

DUMAGUETE (4) DAVAO CITY (19)

 Teletech  VXI Global Solutions
 SPi Global  Sutherland Global
 Stream
 Amberbase
CAGAYAN DE ORO (8)
 Synnex – Concentrix Corp.
 Arriba Telecontact, Inc.
 Capitol University Call
Center

SOURCES
 National Statistics Office
 Commission on Higher Education
 IT & Business Process Association Philippines
 The Everest Group
 Board of Investment
JOEY RADOVAN MELIZA CALLEJA JENNELYN NG
For more Vice Chairman Senior Manager Client Support Services Associate
information +632.759.4158 +632.752.2580 +632.752.2580
contact: +63920.906.7517 +63917.574.3057 +63915.989.1515
joey.radovan@cbre.com.ph meliza.calleja@cbre.com.ph Jennelyn.ng@cbre.com.ph
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CB Richard Ellis Philippines 2014