By Justine Irish D. Tabile, Reporter
MORE COMPANIES from the European Union (EU) are seeking to enter the Philippines, with information technology (IT) investments from the bloc already surpassing investments from North America, according to the Philippine Economic Zone Authority (PEZA).
In a Viber message, PEZA Director General Tereso O. Panga told BusinessWorld that approved IT projects from the EU more than doubled to P4.11 billion in 2023 from P1.56 billion the year prior.
The investments, he said, also accounted for 55.4% of total IT investments the investment promotion agency (IPA) approved over the same period.
“This only shows that the Philippines has become more attractive to EU information technology and business process management (IT-BPM) companies as a location for offshore services,” Mr. Panga said.
“In fact, their FDI inflows in 2023 have outperformed North American investors, who have dominated the ecozone IT-BPM industry in the last two decades,” he added.
In particular, Mr. Panga said that PEZA has been engaging with Foundever, a contact center company in Luxembourg.
“(It) recently acquired Sitel and Sykes Asia, both well-known IT-BPM companies in the Philippines,” Mr. Panga said.
He added that French bank BNP Paribas visited the Philippines last year with the aim of setting up a back office for financial services to serve its global clients.
Mr. Panga said that the EU-Philippines free trade agreement (FTA) as well as the renewal of the Generalized Scheme of Preferences Plus (GSP+) trade concession will be vital in making the country more attractive to EU investment.
“(Those) will help the Philippines in its bid to attract EU foreign direct investment (FDI) from diverse strategic industries, catering to both domestic and export markets, particularly for the IT-BPM sector, which continues to flourish, even outperforming the global IT-BPM sector in terms of revenue growth and headcount,” Mr. Panga said.
“As one of the IPAs in the country, this will likewise be instrumental in PEZA’s quest towards positioning the Philippines as the ideal base for offshore operations by EU companies hoping to penetrate the much more vibrant ASEAN and Asia-Pacific markets,” he added.
Last month, the EU and the Philippines announced the resumption of FTA negotiations which had been stalled for seven years due to the trade bloc’s concerns over the human rights record of former President Rodrigo R. Duterte.
Trade Secretary Alfredo E. Pascual said that the formal or face-to-face negotiations for the FTA could come as early as the second half of the year, with preliminary talks starting at lower levels last month.
