Australian SME micro-offshoring in the Philippines: Opportunities and challenges

Abstract

An increasing number of Philippine-based business process outsourcing (BPO) centers, however, are targeting Australian SME clients by offering micro-offshoring services that reduce the transaction costs. This Policy Note examines the BPO sector and considers the potential economic and social gains of this Notesexpanding niche market. Such gains include entrepreneurial opportunities for local firms and overseas investors and the creation of new relatively well-paid jobs for Filipino professional workers and graduates. These developments are expected to foster the growth of the Filipino middle class. This Note is based on a research conducted in 2016 on the BPO sector in Metro Manila and Clark Freeport Zone in Angeles City, Pampanga. Data were obtained through interviews and discussions with BPO managers, Australian SME clients, and other relevant persons. The paper is further supported by the long-term industry experience and knowledge of one of the authors.