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By 2033, the Philippines is forecast to become one of the Asia-Pacific region's trillion-dollar economies alongside China, Japan, India, South Korea, Australia, Taiwan and Indonesia. Under colonial rule by the Spanish and then the US before gaining independence in 1946, the country is a natural gateway from the West to the broader Southeast Asia market. With a top-quality education system and increasingly creative business culture, it’s a compatible environment for long-term outsourcing partnerships. Expertise in business process outsourcing tasks and sought-after skills such as big data, data analytics, cybersecurity, blockchain, digital commerce and fintech are on offer.
Talent Pool & Education
The Philippines offers a highly educated, English-speaking workforce and the country’s young population and growing middle class are important drivers of IT demand.
The most recent figures available from the Philippine Statistics Authority show the digital economy surging to about $36.5 billion in 2022, contributing 9.4% to GDP. According to the IT-BPM Association of the Philippines, by 2028 the tech industry is expected to generate more than one million new jobs in the country, of which 150,000 will be developer roles.
To meet the demand for digital skills, the government has doubled its investment in information and communications technology packages and IT infrastructure in public schools, with a focus on digital literacy ranging from basic coding to mobile app development. Software development for revenue management systems, tax collection, and a one-stop online platform for business processing are projects in the pipeline.
The Philippine Development Plan 2023-2028 specifies digital transformation as one of its underlying themes and public-private partnerships are being proactively encouraged with stakeholders in the skills ecosystem to develop digital careers in the workforce. Key trends include automation replacing routine business process outsourcing tasks, and core skills such as big data, data analytics, cybersecurity, blockchain, digital commerce and fintech becoming increasingly in demand.
The Philippines is officially bilingual, with more than 14 million people speaking English alongside Filipino. A legacy of the Philippines’ history as a US colony from 1898 to 1946, English is the principal medium of instruction in education, as well as the language of trade and law, so there is exceptional proficiency even in business and technical fields.
The Philippines is considered one of the most dynamic economies in East Asia and the Pacific. Rapid growth in the IT and business process outsourcing sector and a bounce-back in tourism are expected to drive momentum through 2024, following a doubling in international visitor arrivals over the past year. The country’s manufacturing sector is one of the fastest growing among the major economies worldwide and a rebound in electronics exports is expected as global demand recovers. The tertiary sector, which represents 61% of GDP and employs 58% of the country’s workforce, has also developed substantially, particularly in telecommunications, call centers and finance.
Higher interest rates slowing private consumption and investment are predicted to lead to modest economic growth before the market picks up speed in the second half of the year. Over the medium-term, the outlook will continue to be supported by strong domestic demand, driven by a robust labor market, continued public investments and a boost in private investment due to recent policy reforms.
Ferdinand Marcos Jr – son of the former Philippine dictator ousted in the 1986 "people power" revolution – won a landslide victory in the 2022 presidential elections after campaigning on a message of unity. The government has strengthened economic, political and military ties with the US since his election and taken a tougher stance against China in the disputed South China Sea, an unexpected shift away from the position held by outgoing leader Rodrigo Duterte's focus on relations with China.
Marcos also surprised many in late 2023 by restarting peace talks with the National Democratic Front in an effort to end the world’s longest-running communist armed rebellion. Since then, however, contradictory statements, public bickering and continued armed clashes between the military and the rebels have tarnished hopes of an agreement. An ongoing political crisis is also simmering over efforts by Marcos and his allies to amend the country’s constitution to allow the promotion of foreign investment.
Under Philippine law designed to protect against dictatorships, presidents can serve only one term in office. Duterte’s daughter, Sara Duterte, who ran on a joint ticket with Marcos and is now his vice-president, is tipped to contest the next presidential race, scheduled for 2028.