BPO sector must ‘reinvent itself’ to survive AI shift, Roxas says

Katrina Domingo, ABS-CBN News

Posted at Apr 11 2019 11:19 PM | Updated as of Apr 11 2019 11:53 PM

According to Mar Roxas, who helped set up the local BPO sector in 2000, the call center industry faced headwinds in 2007 but it upgraded itself by digitizing directories and training people to survive the lull. File/George Calvelo, ABS-CBN News

MANILA—The government must allow the business process outsourcing (BPO) industry to “reinvent itself” and update incentives packages to help the sector survive the digitalization shift, senatorial candidate Mar Roxas said Thursday.

According to Roxas, who helped set up the local BPO sector in 2000, the call center industry faced headwinds in 2007 but it upgraded itself by digitizing directories and training people to survive the lull.

“The industry has to do the same things again because there is a new set of challenges — machine learning, big data, all of these things,” he said in a forum attended by industry stakeholders.

The reinvention of the $24-billion industry must be left to the private sector, Roxas said.

“We agreed [in 2007] that we should keep government out of it because government’s instinct is to regulate . . . It’s the private sector that fuels it,” he said.

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The government should not scrap tax incentives for BPO companies, but replace it with a new package that would push call centers to train Filipino employees instead of seeking more skilled workers elsewhere, he said.

Several companies in the country earlier said they might relocate to other countries should the Duterte administration’s Tax Reform for Attracting Better and High Quality Opportunities or TRABAHO bill (formerly TRAIN 2) be implemented.

The proposed policy seeks to rationalize fiscal incentives and lower the corporate income tax rate. 

“Hindi na natin kailangan i-incentivize to stay here kasi alam na nila paano magtrabaho ang Pilipino,” he said, noting that he wrote the incentives package for BPOs in 2000 when he was Trade chief.

“I-incentivize natin sila to train their people. Halimbawa, for every person you train, we will deduct 1 peso from your income tax liability.”

“Dapat ’yung ating package, incentives, education, amenities, dapat ang packages natin today ay angkop sa challenges today. Hindi natin sila maakit na dito mag-stay kung ang package natin ay pang-2000. Dapat ang package natin ay pang-2025,” he said.

The industry reinvention must take place as “ministerial jobs will disappear in 20-30 years,” Roxas said.

“That doesnt mean na mawawala ’yan (BPO) sa atin, but we have to adapt, we have to move up the value chain,” he said.

“The challenges are going to be different. The answers to these challenges will be likewise different.

“The thing is we need to be agile in our ability to predict and respond to these challenges.”