MANILA, Philippines ? Filipinos had better improve their their English to keep the country?s competitive edge in the global business process outsourcing industry as China is improving its people?s English-speaking skills and could emerge as a key player in the BPO business, a top official said.

Socio Economic Planning Secretary Augusto Santos warned that China could dislodge the Philippines as one of the top destinations for the offshore outsourcing business.

?If we don?t watch out, we may be overtaken,? said Santos at a media briefing, following a meeting of the National Economic Development Authority (Neda) board and the National Anti-Poverty Commission in Malacañang.

?We are part of the global community and there is economic competition among countries. If we want to increase our competitiveness, we have to continuously improve our proficiency in English,? Santos said.

In a report that he submitted to the meeting, Santos cited a recent international study showing China catching up with traditional BPO powerhouses like India and the Philippines.

?China is really gearing up and teaching its people to learn how to speak English,? he told reporters.

?As of now, we still have the edge, but indications are pointing to China?s catching up,? he said.

Santos said China was moving closer to the top ranks of BPO players because of the improved ?Chinglish? proficiency of its workers, in addition to its cheap labor force in a country of around one billion people.

He said the Philippines? edge was also partly affected by the passage of the minimum wage law, which increased the cost of labor here.

Told about China?s emergence, President Macapagal-Arroyo is said to have told officials: ?So we have to watch out. We have to watch out.?

Last month, the Business Processing Association of the Philippines said the country was facing tough competition from Vietnam, Malaysia and Sri Lanka.

Along with India, these countries have been aggressively marketing themselves as top BPO destinations, according to Oscar Sanez, the BOAP president and chief executive.

?The country has been registering declines in so many global competitiveness surveys. More than any time, we need a global awareness campaign to be launched now,? Sanez said.