Cebu still top emerging outsourcing city

By Ehda M. Dagooc (The Freeman) Updated October 20, 2009 12:00 AM

CEBU, Philippines - For the second consecutive year, Cebu has emerged as the number one “Emerging Outsourcing City” of the world.

Based on the latest report released by Tholons, a leading full-service strategic advisory firm for Global Outsourcing and Investments, Cebu bested other cities in the world like Shanghai and Beijing in China, Krakow in Poland, and Ho Chi Minh City in Vietnam.

In its fourth year, Tholons not only lists/ranks the eight established and 50 emerging destinations, but also ranks the Next 10 aspiring cities ‘on the Tholons Radar.’

The report also provides relative scores of each of the cities for the six parameters of scale and quality of labor pool, cost, business catalyst, infrastructure, risk and quality of life, which are a part of the Tholons Location Assessment Framework.

The study views offshore destinations and location assessment from the perspective of the clients।

Cebu Investments and Promotions Center (CIPC) managing director Joel Mari S. Yu said that although this news is again a “very, very” good for Cebuanos, it would have been better if Cebu has graduated from an emerging BPO destination in the world to an “emerged” or “developed” destination.

Yu suspects that the limited manpower supply in Cebu is one of the primary problems, why Cebu can’t climb up to become a “developed” BPO destination in the world.

This year, the top five (developed) Global Outsourcing destinations are Bangalore (India), Delhi (India), Mumbai (India), Manila (Philippines), and Dublin (Ireland).

These cities, he said, produce at a minimum of 150 to 200 thousand graduates a year.

Cebu on the other hand, can only produce an average of 23,000 graduates annually.

“We have good quality of manpower. Our infrastructure is good. I suspect our problem is in the supply of manpower,” Yu said.

He said Cebu could have reaped the benefits of being number one emerging BPO destination in the world last year, ifnot for the economic recession.

“Our problem is, majority of our outsourcing market is from the US,” he said adding that Cebu’s positioning was adversely affected by the US economic turmoil, as most big ticket BPO investors decided to postpone or delay their expansion plans.

The consistent positioning of Cebu as number one emerging BPO destination is expected to bring more investments to the province this year especially that the US economy is starting to recover, Yu said.

The Information Communication Technology (ICT) sector is now under pressure to improve its rank from number one emerging BPO (Business Process Outsourcing) destination in the world, to fully emerged BPO destination.

Cebu Educational Development Foundation for IT (Cedfit) managing director Bonifacio Belen in an earlier interview said that because of this pressure, there is a need for Cebu to address several challenges that may hamper the realization of Cebu becoming an emerged BPO destination in the world.

Belen said Cedfit initially identified several challenges being faced by the ICT sector in Cebu, these are; the lack of middle-management manpower pool, weak development of home-based ICT businesses, and small local ICT market. —/NLQ(FREEMAN NEWS)