The Business Process Outsourcing (BPO) industry can counter the adverse effects of a strong peso by venturing into more high value segments such as finance and accounting as well as research services, an economist said Thursday.
According to economist Cid Terosa of the University of Asia and the Pacific (UA&P), the non-voice segment of the outsourcing industry “have higher value-added so revenues can go up.”
The suggestion came after the Business Processing Association of the Philippines (BPAP) issued a statement saying that the strong local currency made outsourcing to the Philippines 30 percent more expensive than India.
Likewise, a survey of BPAP members on the impact of the steadily appreciating peso showed that 46.7 percent of the respondents felt difficulties in hitting their respective revenue targets.
On Thursday, the peso closed at 41.125 against the US dollar, an appreciation from 41.16 on Wednesday.
To keep its spot in the global outsourcing industry, Terosa said BPO companies should expand and find areas that have “low costs of doing business and enough telecommunications infrastructure.”
Other economists earlier called on the private sector to push for government intervention to weaken the peso so as not to hurt exporters and the BPO firms that largely benefit from a weaker currency.