Trump won presidency in the 2016 Presidential Elections. The threat to the Philippine BPO industry latches on. Elected as the 45th President of the United States is Donald Trump, the Republican candidate. Known for his vulgar statements, Trump faces criticisms of having no experience in foreign policy and in political environment. Up to the last minute, the race for president was a close one since Trump’s contender was the former first lady, former Senator and former Secretary of State, Hillary Clinton.
Trump’s victory has caused commotion in the BPO industry. One statement known for Trump are his statements regarding about US job protectionism. Trump wants to bring jobs back to the US.
“Not that existing US-based IT (information technology)/BPO firms operating in the country would be likely to leave abruptly under a Trump presidency, but ’prospective’ BPO business may diminish, already wary of (President Rodrigo) Duterte’s anti-US rhetoric and shift to a more independent foreign policy,”
Inquirer.net reported that in the eve of the US election, Citi Philippine economist Jun Trinidad said a Trump presidency highlighted trade protectionism.
“For the Philippines, we think a material risk from a Trump presidency may be a US job protectionism, which could weigh on global outsourcing/offshoring activities from which Philippines (and other emerging markets) benefit,” Trinidad said.
Bangko Sentral ng Pilipinas data says that 70 percent of BPO revenues come from the US. As per Colliers, the Information Technology and BPM industry generates $168 billion in terms of revenues in India and the Philippines.
Trinidad also expressed that US-based IT/BPO firms are likely to leave abruptly under a Trump presidency. He also added that perspective business may diminish.
Before the election, Trinidad estimated that $1 to $2 billion worth of business will be at risk depending on the results of the elections. The said amount reflects to 0.4-0.7 percent of Philippine gross domestic product (GDP) in lost BPO business opportunities.
Furthermore, Trinidad says that lost in BPO opportunities can also translate to loss of real estate investment gains as well.
“Since BPO office requirements sparked the commercial office segment building boom, lost BPO opportunities may shade real investment gains as well. Upbeat construction jobs, up recently by 655,000 (based on July labor survey) due to strong investments, would be affected, reinforcing potential consumption weakness,” Trinidad said.