BPO sector showing signs of renewed vigor
The business process outsourcing (BPO) industry in Metro Manila is starting to regain its momentum in the office property market, but its growth could have been “so much bigger” without tax reform.
David Leechiu, CEO of the Leechiu Property Consultants firm, said on Tuesday that the BPO industry in Metro Manila was starting to recover from its “massive decline” in net office takeup last year.
“It’s just about recovering and gaining track in 2018, but it could be so much bigger. It could be more than the numbers we saw in 2016,” he said.
In 2017, the industry’s net office takeup dropped 26 percent from the 485,100 square meters (sq m) recorded in 2016 to 357,999 sq m.
The latest figures, however, show a glimmer of hope.
As of September this year, the numbers have already reached 301,275 sq m, marking more than 84 percent of the total takeup in 2017.
“That could have had tremendous growth in 2017, but we scared them away. And we’re trying to win them back in 2018. I think we’re going to close 2018 more or less the same number [as], if not slightly more than, 2017,” he said.
This comes as the Duterte administration has been pushing for further tax reform since last year, which includes rationalizing the incentives of the industry.
This uncertainty was recently offset by two things, Leechiu said, the higher wages in the US that pushed firms to outsource and the weaker peso.
“What I would like to say is that we still have to keep working together to remove all these obstacles because the BPO industry could very well keep growing at a tremendous pace,” he added.
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