The global outsourcing market with the Philippines continually betting on the revenues and the jobs, forecasting a growth rate of 20 percent to 30 percent. The country needs to refocus its promotion direction to the new markets like the Europe with its main client, the United States increasing protectionist moves. President Obama announced that his plans to end tax breaks for the US firms expanding overseas as a part of fixing a broken tax system. This aims to save American taxpayers $210 billion over the next ten years and to generate more jobs in the country. To outsource, the announcement caused concerns for the American multinational firms whose major competitive strategy is to outsourced. Both the Business Processing Association of the Philippines and India Inc. dismissed the threat.
The major US financial firms including the Citigroup Inc. with the 60 percent of its workforce abroad and JPMorgan Chase and Co. with the 10 percent of its workkforce in Asia have hired employees abroad not for the tax deferrals but it is because of the lower cost of the competitive labor. The commission on Information and Communications Technology commissioner told the times that the companies will continue to move jobs to places where they can be done, cheaper better and faster like the Philippines. The commissioner also mentioned that the CICT has an anticipated that the US move and have started focusing their promotions to the new markets like Europe where demand is high.
In the new market outsourcing demand, the labor sourcing adviser TPI Managing noted that the Europe has shown an increase in the outsourcing activities in the past 4 years. It has accounted for 49 percent of the major outsourcing contracts worldwide in 2004. The Europe has realized that the outsourcing is the key to remain competitive in a global scale. In the 2004 alone, the UK signed a total of 11.5 billion euro outsourcing contracts. The German companies awarded 7 billion euro of the outsourcing contracts in 2005. The Europe signed outsourcing deals which amounted to $0.9 billion which was even a higher than Americas $26.6 billion.
REFERENCE:
http://www.blog.infinit-o.com/philippine-outsourcing-targets-europe/
