Philippines top choice among US companies for finance, BPO services

Jun. 04, 2007

MANILA Consul General Cecilia Rebong of the Philippine Consulate General in New York, USA reported to the Department of Foreign Affairs that a capital markets analyst has said that the Philippines is the top choice among a growing number of major U.S. companies for finance, technology, telecommunications and consumer products, and accounting business process outsourcing (BPO) services.

Consul General Rebong said this was essentially the message of Ms. Cynthia Houlton, Senior Analyst of RBC Capital Markets, in speaking on Global Sourcing and Finance and Accounting Business Process Outsourcing Services during a well-attended business networking reception organized by the Business Process Outsourcing Council, the Philippine Consulate General, and the Philippine Trade Office in New York on 23 May 2007.

Welcoming the guests who were mostly CEOs, presidents, and managers of major American financial, banking, and investment companies based in New York, Consul General Rebong said, The reception is only our second offering since the creation of the Business Process Outsourcing Council one month ago, and the goal remains to be to facilitate dialogue, information, and greater understanding of the Philippines Business Process Outsourcing (BPO) sector among potential global partners.

Ms. Houlton reported that among the US companies to consider the Philippines as a top destination for their offshoring services are ACN (Accenture), Genpact, ICT Group, Inc., TTEC (Teletec Holdings, Inc.), ETEL (eTelecare Global Solutions, Inc.), and PCPT (People Support, Inc.). Ms. Houlton said that these companies posted phenomenal revenue growths during the first quarter of 2007 from their offshore BPO/Contact Center operations.

The main speaker, Mr. Gary Reddick, Senior Vice President of AIG Worldwide Life Insurance, shared why his company selected, and is now running a business process operation in, the Philippines, stating By locating in the Philippines, we are able to leverage AIG’s strong local presence in an environment that is highly conducive to US-focused outsourcing operations.

AIG American General is the second largest life insurer in the United States. In 2002, it formed AIG-BPSI as a joint venture between AIG General and Philamlife, the largest and most diversified insurance company in the Philippines. AIG-BPSI was to provide outsourced backroom processing as well as contact center services to AIG and its various customers worldwide. AIG-BPSI launched full operations in January 2003. In April 2006, AIG American General completely bought out Philamlife interests in AIG-BPSI.

Mr. Reddick also noted that AIG selected the Philippines because of the country’s advantages over alternative Asian sites: Labor costs equivalent to China; lower and more stable than India; prevalence of spoken American English; cultural and social affinity with the US; modern and stable infrastructure such as water, power, roads, telecommunications; large pool of qualified college graduates seeking white-collar employment; access to specialized skills aligned with US professional standards; government support and tax breaks for the industry; and more familiar environment for expatriate trainers and managers than other Asian alternatives. He added that having a local partner like Philamlife helped a great deal.

The ‘advantages’ cited by Mr. Reddick clearly show that the Philippines’ attractiveness as a BPO destination is no longer limited to cost-reduction but also to being able to provide global partners with a human resource possessing the right skill sets and competencies supported by a sophisticated telecommunications infrastructure, Consul General Rebong observed. END

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