Philippines. Call agencies and outsourcing to gain economic advantage
The article talks about the Philippines' rise in market contestable nature. Having one of the largest populations in the world, the Philippines is able to utilize the high labour force and relatively cheap labour. India is one of those countries that are being threatened by the Philippines' rise in market power. India is a country that also has a large amount of labour force and relatively cheap labour. However, the Philippines has larger and cheaper labour force.
Although the Philippines is proving to become a competitive country, in regards to call center businesses, India still has the comparative advantage because of its wider range of technological advancement in communications, transportation and other such equipment. Therefore the only solution that the Philippines call centers can find is to attain these technologically advanced machines missing in the Philippines but available in other more economically developed countries. Also, to find a way where wages are kept low but, at the same time, maximize efficiency and profit.
The interesting thing about this article is that these local companies have to employ international help such as Avaya, which specialize in providing communication solutions. (outsourcing)
I find this particular article about outsourcing to be interesting because, I would never had imagined that the Philippines, a 3rd world country and an impoverished country, would be able to challenge India, a developing country but also a more economically developed country compared to the Philippines, over the market power on communications and call centers. The article enlightened me and made me see how the dense population, that is sometimes seen as a negative factor, can be used in a manner that can benefit the Philippines' economy.
What to do you think? Will the Philippines find a way that will allow it's power in the communications market to increase? What methods/strategies do you think the Philippines will be able to improve their power?
Definitely. The fact that wages are low is always going to make this place attractive to investment. Also, since English is so widely spoken, there's no doubt that makes a big difference. Finally, I think the Philippines is going to keep focusing on call centers and communications as a major boost to their GDP and will do everything they can in the way of government policy to keep that ball rolling by making laws that make it enticing to investors as well as keeping the ASEAN countries interested in the Philippines as a potential investment opportunity through the trade bloc negotiations they have.
ReplyDeleteI agree with Mr. Barnes about how the wages in the Philippines are low which makes the country an attractive place for investment. In my opinion, I think that as the Philippines continues to develop, they will be able obtain the technology needed to increase its power in the communications market. From the article I read, call centers in the Philippines do and will contribute greatly to the GDP of the Philippines. What Mr. Barnes said about speaking English is another big factor. The call centers in the Philippines provide many jobs for Filipinos and the wages are somewhat higher than minimum wage, however the working hours may not be good.
ReplyDeleteI agree with both Mr. Barnes and Chanel that the Philippines is a very attractive place for investment. Even though India has is fierce competition in outsourcing, the Philippines is the top country for call centers. The government will continue to support its growth as it contributes a large part of the country's GDP, by providing tax breaks for companies or designating special economic zones . It definitely helps that wages are low but also as has been said, a highly educated workforce especially in English is a major factor but also the strong influence of Western culture makes communications easier.
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