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Outsourcing a matter of foreign policy

Posted on March 27, 2017

US elections and outsourcing

Philippine President Rodrigo Duterte has kept a decidedly firm stance on the allowance of United States-headed businesses to continue their businesses in the country. In his own words, he ordered them to “pack their bags” lest they dislike his alleged anti-American rhetoric.

With 12.6% of the world’s outsource work undertaken by the Philippine workforce, it’s no wonder that outsourcing executives are nervous about what this would lead for the country’s options at large.

With the election of President-elect Donald J. Trump, a billionnaire most famous for his appearances as host of NBC’s “The Apprentice,” this sense of uneasiness has only increased. His entire campaign was based on his controversial statements on women, LGBTQI rights, and immigration. With him wanting to keep outsourcing out of the country, it will bring dire news indeed to the Philippines. A large chunk of the country’s outsourcing work comes from the back-end tasks set by Wall Street America and beyond, more than half of all its operations are based in the United States.

With the outsourcing boom in the country facing quite an obstacle, its continuity in ensuring job security for a majority of the Philippine working force will be largely due to the foreign policy practices done by both Duterte and Trump.

“It’s a U.S.-centric business,” according to Manuel V. Pangilinan, president of Philippine Long Distance Communications which is a main service provider for most of the country’s Internet and landline phones. “To the extent that Trump compels, persuades or incentivises the BPO businesses to return … it will impact our business or the industry as a whole. It’s going to be a tough one, not only for us, but for the economy as a whole.”

With the facing threat to outsourcing development in the country, it would do well to keep abreast of foreign policy motives done between the Unites States and the Philippines, as well as the statements of both President-elect Trump and President Duterte.