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THE PHILIPPINE information <\/span>technology and business process management (IT-BPM) sector <\/span>is still optimistic about growth, as it anticipates generating $42 billion <\/span>in export revenues and increasing its workforce to 1.97 million by 2026, an industry organization stated.<\/p>\n The Philippines is also striving to become the next center for global capability centers (GCC), as it has observed a rise in interest from international firms, the organization mentioned.<\/p>\n IT & Business Process Outsourcing Association of the Philippines (IBPAP) President and Chief Executive Of<\/span>f<\/span>icer Jonathan R. Madrid noted that the sector has thus far generated 450,000 new positions and $10.5 billion in income since the establishment of the industry roadmap in 2022.<\/span><\/p>\n \u201cNow, for 2025, that encompasses 80,000 new positions and $2 billion in additional income. That represents a growth of 4% and 5.3%, respectively,\u201d he stated at the International IT-BPM Summit on Tuesday. \u201cBy 2026, we estimate reaching $42 billion in income and nearly a total of two million jobs for Filipinos.\u201d<\/p>\n The anticipated jobs and revenues for 2026 align with the foundational forecasts indicated in the IT-BPM Roadmap 2028.<\/p>\n Mr. Madrid stated that the sector’s expansion will continue to be fueled by core areas \u2014 banking, financial services, and healthcare.<\/p>\n While the Philippines continues to excel in contact centers, he pointed out faster growth emerging from GCCs. \u201c(There\u2019s) a slightly elevated growth rate from GCCs. Coming from a smaller base, you tend to observe more expansion in that arena,\u201d he remarked.<\/span><\/p>\n GCCs are overseas units established by multinational companies to offer specialized services such as finance, IT, and customer support to their international operations.<\/span><\/p>\n Mr. Madrid mentioned that he is witnessing heightened interest in establishing GCCs in the Philippines from potential clients in the US, Australia, and Europe.<\/span><\/p>\n On a global scale, GCCs are transforming the IT-BPM sector, with its market anticipated to grow to $155 billion by 2027.<\/span><\/p>\n Currently, there are 170 GCCs in the Philippines, expanding by about 10 each year, but India continues to lead with its 2,000 GCCs.<\/span><\/p>\n \u201cWe acknowledge that India leads as the world\u2019s GCC hub, illustrating how GCCs have progressed. They are no longer merely cost centers but strategic engines of innovation and change,\u201d Mr. Madrid expressed.<\/span><\/p>\n \u201cI believe the Philippines should aspire to achieve similar feats. We possess the talent, we have the scale, the cost efficiency, and the ecosystem maturity to become the next global GCC hub,\u201d he added.<\/span><\/p>\n LEGISLATION REQUIRED \u201cGCCs have distinct requirements compared to traditional BPM providers,\u201d she commented, adding that the organization seeks Congress to enact legislation to encourage more GCCs to establish in the country.<\/span><\/p>\n Specifically, she stated that the sector requires a law akin to the Regional Operating Headquarters (ROHQ) law. However, this initiative was \u201cset aside\u201d in favor of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, she remarked.<\/p>\n \u201cWe recognize that other nations have implemented this international business services law to attract more GCCs to their territories. Thus, we aim to pursue similar pathways,\u201d she continued.<\/span><\/p>\n The ROHQ Law, or Republic Act No. 8756, offers incentives to multinational corporations establishing ROHQs and area headquarters within the country.<\/p>\n According to the law, companies that do not generate income from the country are exempt from income tax, while ROHQs and area headquarters are free from value-added tax, local levies, and import duties on training materials, equipment, and vehicles.<\/p>\n \u201cWe are not considering reforming the CREATE Act. Instead, it could be a new piece of legislation similar to the previous ROHQ law. It was specifically designed to attract GCCs to the nation,\u201d she indicated.<\/span><\/p>\n \u201cGCCs are more \u2018cost-plus.\u2019 They act as cost centers, and thus, a different array of incentives will be more significant for them. That is our focus for the upcoming months,\u201d she added.<\/p>\n TOO BIG TO FAIL \u201cThe Philippine IT-BPM sector is too significant to fail. Yet equally important, it is too vital not to evolve. We cannot afford to be complacent. We cannot let the sunset industry narrative take hold. Because we\u2019re growing faster than the global market,\u201d he emphasized.<\/span><\/p>\n
\n<\/b>IBPAP Chief Operating Of<\/span>f<\/span>icer Celeste <\/span>B. Ilagan stated that more efforts are needed on the policy level to foster the growth of GCCs in the Philippines.<\/p>\n
\n<\/b>Meanwhile, Mr. Madrid stated that the IT-BPM sector, which comprises at least 8% of the economy, confronts the challenge of remaining \u201cessential.\u201d<\/p>\n