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Government Support to Companies that Outsource in the Philippines


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Many companies from around the globe outsource in the Philippines. They choose business process outsourcing, or BPO, in the country because of the myriad advantages that it brings to every business from different industries. By means of relocating business operations to the Philippines, companies can enjoy the benefits of having a cost-effective and timely mechanism business strategy. The rates of labor and services in the country are far lower compared to locally. Businesses that relocate non-core business activities in the country can drastically reduce their company expenditures and enjoy excellent quality of services. Furthermore, companies with an outsourcing business partner in the country receive professional support in analyzing the suitability of outsourcing selected operations and in implementing outsourcing programs.

The outsourcing industry in the Philippines is growing rapidly as the country ascended to the rank of the largest outsourcing destinations. Philippine BPO has already created its secured position in the global outsourcing and is now considered as one of the key players in outsourcing business. The Philippine outsourcing industry has been impressively growing since its introduction and is now being considered as the sunshine industry. Outsourcing is also one of the highest revenue generators of the country. According to the primary outsourcing industry body of the Philippines, which is BPAP or Business Processing Association of the Philippines, the IT-BPO industry of the country has generated $9 billion in revenues in 2010, and its global outsourcing market share increased from 7 percent to 8 percent and is continuously growing as the demand for outsourced services in the global market is increasing.

The Philippine government is very supportive of BPO industry in the country, and this is one of the advantages of outsourcing in the Philippines. Some of the incentive packages that the country offers include a reduced corporate income tax. The Philippine BPO has set up special economic zones and companies within this zone are subject only to 5 percent overall tax rates. The country government also grants fiscal and non-fiscal incentives such as a 4-8 year income tax holiday to BPO players. Big multinational corporations that are looking for offshore operations in the Philippines are entitled to incentives such as tax exemption and duty-free importation of specific equipment and materials. The country also has an open economy that allows 100 percent foreign ownership in almost all sectors of the BPO industry. Moreover, the government supports the BOT, or Build-Operate-Transfer investment scheme just like other Asian countries. Public companies and government corporations were converted to private sectors and the banking, insurance, power industries and shipping communications were deregulated.

As a result of visibility and support provided by the Philippine government to BPO industry, investment by BPO firms and shared services operations is expected to further grow and develop in both established business districts and other prime cities. The country has already become one of the best offshore outsourcing destinations in the world.  There are a lot of foreign investors and companies from major markets that outsource in the Philippines after realizing that the country should be included in every sustainability strategy.

 

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Outsource in the Philippines has been proven; fast and effective, with Outsourcing Accounting and IT Support Outsourcing, Outsourcing Help Desk have a low-cost and effective management.

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Marian Maurer Article's Source: http://articles.org/government-support-to-companies-that-outsource-in-the-philippines/
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  • Posted On April 18, 2012
  • Published articles 10

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