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Local IT sector confident of recovery by next year

03/06/2009 | 01:59 PM
MANILA, Philippines - The Philippines information technology sector, including the business process outsourcing industry, remains optimistic of recovery by next year.

Financial pressures have currently affected both buyers and sellers of IT services," thereby cutting demand for people's services," especially IT workers, a representative of research company XMG said at a recent CyberPress forum in Makati City.

Moreover, the global slowdown has triggered the "restructuring of the IT and IT services market" and given the ICT workforce an "opportunity to normalize its talents globally," XMG chief researcher Lauro Vives said.

Since semiconductors form an integral part of most consumer electronics - such as laptops, desktop computers, cellular phones, and the like - demand has dropped so much that it has forced companies to lay off workers, Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI) chairman Arthur Young said at the forum.

On the more upbeat note, Young also said global think tank forecasts predict "double-digit growth" for sub-laptops, also called ultramobile PCs (UMPCs) or sub-notebooks, in the months to come.

"However, fewer semiconductors are needed to make sub-notebooks, so that still translates into a lower demand for semiconductor parts," he said.

Due to these factors, the first quarter of 2009 is not a good one for the Philippines semiconductor industry, though he expects to see a slight recovery in the second quarter of the year, adding that some "very challenging numbers" on the semiconductor industry's growth in the first quarter will come out.

"2010, on the other hand, will be a good growth year, albeit in single digits' and we expect to see recovery in 2011, when money will be flowing back into the market and we will see double digit growth," he said.

For consumer electronics and software, Information Technology Association of the Philippines (ITAP) president and Lenovo Philippines country manager Vicky Agorrilla said the economic downturn has created a "challenging environment."

"Now our main concern is keeping the flock together," she said. "We will try in every way to help affected [industry] employees find a job in the same industry before we let them out of our yard," she said. "All [ITAP member companies] will strive to be on the boon side of this boon or bane scenario, cushioning the impact where they can and we are working on a plan to shorten the effect [of the financial crisis] on the nation."

Business Process Outsourcing Association of the Philippines (BPAP) CEO Oscar Sanez also said that outsourcing remains in the pink despite the downturn and that BPAP expects the country's sunrise industry to experience growth figures in the double digits of between 20 percent and 30 percent, translating to about $7 billion in revenues.

Sanez also predicted growth in "non-voice" BPOs, such as back-office processes, human resource development services, medical transcription, legal back-office work and the like.

Sanez also said the BPAP and the government are pooling resources to improve curriculum development efforts, competency assessment tools and some P350 million for scholarships for 60,000 beneficiaries to ensure that the country's BPO labor pool maintains and improves the advantages it already enjoys - high education and skill levels and fluency in the English language. - GMANews.TV

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