RP outsourcing revenue seen up by 22%;
Research firm expects slowdown in FDI
Manila, Philippines - September 24, 2009
 DESPITE THE GLOBAL ECONOMIC downturn, the outsourcing
industry is expected to register a 21.7-percent increase in
revenue to $7.3 billion this year, according to Canada-based
research and advisory firm XMG Global Inc.
This growth, however, would be lower than the 24 percent
XMG Global had projected at the start of the year, due
mainly to slower information technology services growth and
the shelving of expansion plans of several players in the
captive market.
The research firm also forecast a slowdown in foreign
direct investments this year, with investors streamlining
their capital and opting to adopt a wait-and-see attitude.
Of the projected $373 billion in global outsourcing and
offshoring revenue for 2009, XMG Global said the Philippines
would account for 6.9 percent, slightly higher than its
6.7-percent share of the pie last year.
India would continue to hold the lion’s share of the
market, with revenue expected to reach $48 billion for a
44.8-percent share of the global market.
China was expected to be a far second with a 25.9-percent
share, or $28 billion in revenue, the research firm said.
“The market share of India is similar to 2008 and has
mostly to do with the Satyam accounting adjustments and the
shifting of work to other countries. In other words, we are
seeing new levels of normalcy in which the recession has
provided the opportunity to rationalize and shift work to
other offshore destinations other than India,’’ XMG Global
senior analyst Vincent Altez said in a statement.
Overall, the global outsourcing and offshoring industry
should post $373 billion in revenue this year, 14.4 percent
higher than the $326 billion generated in 2008.
As with the Philippines and most markets, however, this
growth would be slower than the 19 percent registered last
year.
Altez said the mere fact that the industry still posted
double-digit growth amid the recession proved that the
outsourcing and offshoring industry was one that could
withstand economic storms.
For next year, he said the industry should experience some
changes in market value as well as in the dynamics of global
sourcing, to be spurred mainly by a number of different
factors.
by Abigail L. Ho
for Philippine Daily Inquirer
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