Strong Government Support for Outsourcing Customer Service in the Philippines

From the time that it penetrated the Philippines in 2000 and helped the economy to survive, until now that we are still fighting against the economic restraints brought by the coronavirus pandemic, outsourcing of customer service has gone a long way and proven to be one of the country’s pillar for economic growth and development.

Outsourcing customer service in the Philippines had succeeded and soared up for more than two decades now. It was initiated in 1992 when an international Global Resource Center started the local outsourcing industry. It opened thousands of job opportunities to Filipinos who were hardly looking for decent and better jobs. But with many job opportunities brought by outsourcing, high-skilled, talented, and hardworking citizens were given a chance to be employed in BPO companies. One genuine proof of the success of the outsourcing customer service in the Philippines is when this country defeated India in being the world’s BPO leader in 2010, according to IBM’s Global Locations Trend.

Do you want to know the reason behind outsourcing customer service’s success in the Philippines? No other than unconditional, continuous, and strong government support. The support of the past and present leaders of the country is commendable as they are giving their hundred and one percent support and approval. From President Gloria Arroyo’s regime up to the incumbent President Rodrigo Duterte’s reign offers favorable benefits that outsourcing companies couldn’t resist. Eligibility for several incentives like tax holidays, simplified import and export procedures, tax exemptions on imported capital equipment, and the privilege to employ foreign nationals are some of the benefits that the government proposed. And no other country offers something like that other than the Philippines.

Below are some of the remarkable programs that the government has implemented to show its support to the outsourcing industry:

• In 1995, Congress passed the Special Economic Zone Act. It is a law, and its purpose is to promote foreign and local investments in the ecozones. It is preceded by the creation of PEZA or the Philippine Economic Zone Authority. With this, many opportunities were opened for international outsourcing companies in the country.
• It was during the leadership of former President Gloria Arroyo when outsourcing customer service flourished and continued to succeed. Many outsourcing companies were outsourced in the Philippines and offered plenty of jobs for the Filipinos. Department of Trade and Industry Secretary Mar Roxas launched the “Make IT Philippines” program and established the first IT-enabled services to the United States. This project led to the biggest investors in the global industry. It gave thousands of jobs to Filipino IT employees. Some of the results of the administration’s support in the online outsourcing industry were the creation of the Commission on Information and Communication Technology and training vouchers from TESDA (Technical Education and Skills Development Authority.)

  From 2,400 call center agents in 2000, it multiplied to almost half a million workers at the end of 2009. And for over the decade, the BPO industry increased by an impressive 65% per year. The Contact Center Association of the Philippines, or CCAP, was established in 2001. It became the umbrella organization of the country’s contact center industry.

• When President Rodrigo Duterte approved the implementation of the Tax Reform for Acceleration and Inclusion Act or TRAIN Law, the Department of Finance assured that the foreign services of BPO companies in Special Economic Zones will not be affected and they are exempted from the value-added tax. Meanwhile, companies that are not included in the SEZ remain at their zero-rated status.

  The fearless statement of President Duterte regarding the “separation” of the Philippines from the United States made the BPO industry upset. It was understandable because the majority of the BPO clients are Americans. But the president guaranteed not to get worried. The country’s democracy will remain, and he will follow free enterprise.

Now that only a few months remain in 2021 and the pandemic isn’t yet over, the outsourcing customer service in the Philippines remains strong and will continue to help the country and its citizens. And it is expected that several outsourcing jobs will multiply.