(01-16-2015 02:49 AM)username Wrote:  

(01-15-2015 03:27 AM)El Chinito loco Wrote:  This is only true if the economy improves by leaps and bounds. The GDP in the P.I. has had a drag up effect from mainland China's growth but on its own it has not developed truly competitive industries. I just don't see it happening.

I too don't see the Philippines economy improving by leaps and bounds. The majority of Filipinos don't have the drive and entrepreneurial spirit that the country needs. I think most Filipinos are hard workers but something culturally limits them from taking it to the next level and building up from it. I think the majority of Filipinos are just in survive and get by mode, not concerned about conquering the world or concerned about living in a big mansion with lots of shit. If the majority of people are this way and happy with it, I don't see them or the economy stepping up. Another factor mentioned is corruption and government, both things working against the common man.

It is a big contrast compared to the United States or China where the majority aspire to an even better life, bigger house, best car, make more money, etc. Sure Filipinos maybe have aspirations of a better life but don't have the drive to see it through.

The millions of Filipino OFWs in places like Saudi Arabia, Dubai, and even Iraq show how hard they will work.

I think the limits on the Philippine economy are imposed by geography. There's only so much that the outlying islands of an archipelago plagued by typhoons, earthquakes, and volcanos can develop.

I see Luzon developing rapidly over the next years, followed by Cebu, Negros and Mindanao.

(01-16-2015 02:11 PM)Sp5 Wrote:  

(01-16-2015 02:49 AM)username Wrote:  

(01-15-2015 03:27 AM)El Chinito loco Wrote:  This is only true if the economy improves by leaps and bounds. The GDP in the P.I. has had a drag up effect from mainland China's growth but on its own it has not developed truly competitive industries. I just don't see it happening.

I too don't see the Philippines economy improving by leaps and bounds. The majority of Filipinos don't have the drive and entrepreneurial spirit that the country needs. I think most Filipinos are hard workers but something culturally limits them from taking it to the next level and building up from it. I think the majority of Filipinos are just in survive and get by mode, not concerned about conquering the world or concerned about living in a big mansion with lots of shit. If the majority of people are this way and happy with it, I don't see them or the economy stepping up. Another factor mentioned is corruption and government, both things working against the common man.

It is a big contrast compared to the United States or China where the majority aspire to an even better life, bigger house, best car, make more money, etc. Sure Filipinos maybe have aspirations of a better life but don't have the drive to see it through.

The millions of Filipino OFWs in places like Saudi Arabia, Dubai, and even Iraq show how hard they will work.

I think the limits on the Philippine economy are imposed by geography. There's only so much that the outlying islands of an archipelago plagued by typhoons, earthquakes, and volcanos can develop.

I see Luzon developing rapidly over the next years, followed by Cebu, Negros and Mindanao.

Japan has similar geographical limitations - an island with tsunamis, earthquakes, typhoons, etc - but rose in less than 100 years from a small agriculture-based economy to a global economic power.

I agree with El Chinito - it's cultural. Most Filipinos just are not that driven to move up in the world. People are happy in their retail job or $500/mo VA jobs. They don't try and move up. The Japanese on the other hand are always working their asses off trying to move towards the next promotion, next technological breakthrough, etc.

Japan proved that a small disaster-prone island can be a very powerful economic force; so it's really not geography IMO.

(01-16-2015 09:50 PM)JJJames Wrote:  Japan has similar geographical limitations - an island with tsunamis, earthquakes, typhoons, etc - but rose in less than 100 years from a small agriculture-based economy to a global economic power.

The Philippines hasn't even been an independent nation for 70 years, and in the 50 years before that they freed themselves from a 300+ year Spanish colonization, were re-colonized by the US, and then had their entire country and economy obliterated during WW2.

Compare that to Japan, which has been a country for more than a millennia and was never colonized.

You can't just cherry pick the most prosperous period in a country's history and ignore the hundreds of years before that where they developed and built a foundation for their current economy. It'd be like someone 5 years removed from a Master's degree comparing their income to a person in the middle of a Bachelor's and saying, "look how much money I made in 5 years, you must be an idiot".

(01-16-2015 02:11 PM)Sp5 Wrote:  The millions of Filipino OFWs in places like Saudi Arabia, Dubai, and even Iraq show how hard they will work.

I think the limits on the Philippine economy are imposed by geography. There's only so much that the outlying islands of an archipelago plagued by typhoons, earthquakes, and volcanos can develop.

I see Luzon developing rapidly over the next years, followed by Cebu, Negros and Mindanao.

I think Mindanao has a lot more potential for growth than the Visayas.

It's the bigger landmass and doesn't have the same weather problems, along with being geographically more accessible to neighboring countries.

The only question is whether they can keep the peace in the region.

(01-16-2015 02:49 AM)username Wrote:  I too don't see the Philippines economy improving by leaps and bounds. The majority of Filipinos don't have the drive and entrepreneurial spirit that the country needs. I think most Filipinos are hard workers but something culturally limits them from taking it to the next level and building up from it. I think the majority of Filipinos are just in survive and get by mode, not concerned about conquering the world or concerned about living in a big mansion with lots of shit. If the majority of people are this way and happy with it, I don't see them or the economy stepping up. Another factor mentioned is corruption and government, both things working against the common man.

It is a big contrast compared to the United States or China where the majority aspire to an even better life, bigger house, best car, make more money, etc. Sure Filipinos maybe have aspirations of a better life but don't have the drive to see it through.

Well, when 25% of the population can't even afford the basic necessities of life and another 25% is still very poor, yeah, it's pretty much a given they'll be focused more on survival than mansions and consumer goods.

The majority of people in the US don't move up in class, even given the immense opportunity and extensive government support, so I'm not sure how you'd expect that of people born into absolute squalor.

On the other hand, there are plenty of entrepreneurs in the middle class, though I think most people on the board don't bother to spend much time with that segment of the population.

And regardless, countries like Thailand are much different places than they were 10 or 20 years ago, by all accounts, despite still being relatively weak economically. Considering how young the Phils is as a country, it's pretty much a guarantee we'll see some massive changes in the future.

(01-17-2015 03:00 AM)Enigma Wrote:  

(01-16-2015 09:50 PM)JJJames Wrote:  Japan has similar geographical limitations - an island with tsunamis, earthquakes, typhoons, etc - but rose in less than 100 years from a small agriculture-based economy to a global economic power.

The Philippines hasn't even been an independent nation for 70 years, and in the 50 years before that they freed themselves from a 300+ year Spanish colonization, were re-colonized by the US, and then had their entire country and economy obliterated during WW2.

Compare that to Japan, which has been a country for more than a millennia and was never colonized.

You can't just cherry pick the most prosperous period in a country's history and ignore the hundreds of years before that where they developed and built a foundation for their current economy. It'd be like someone 5 years removed from a Master's degree comparing their income to a person in the middle of a Bachelor's and saying, "look how much money I made in 5 years, you must be an idiot".

Hmm ... that ... is a really good point. Good metaphor too.

I stand corrected.

some important points. I read that a country can only escape such poverty through industrialization which basically means manufacturing. I recommend anyone check page 9 on the following document. I checked this and saw that the Philippines is the ONLY large country that does not even have a place in this. Manufacturing is the most important thing and pretty much the only thing to drive a country out of poverty and Philippines appears to be the only country that won't have the opportunity to do it due to many unlucky and coincidental factors inhibiting its ability to industrialize and develop. Apparently develoment opportunity is so lacking here that it is really kept out of the report showing zero chance to rise up. It shows the Philippins not even emerging in this respect in the foreseeable future with the inclusion of a future development projection also. So no industrialization means no leaving this poverty behind as the country relies on outsourcing that keeps wages low. Philippines is only excelling at call centre industry for the most part. And this indusry depends on the sstagnation of the super low wages. I found out about the notorious habit they have of keeping wages low and the dependence on outsourcing. Also this industry is one where there is little chance for advance in career. I read all about it. The Philippines is very stagnated economically for everyone except the elite. Poverty runs in families. Children born into very poor families grow up in a life of poverty. Also the poorest families contribute the largest number of children so the population growth is based more on the spread of the poor. I heard that dynasties hold strong and the politics is not expected to change in the foreseeable future. With no change in the economic prospects of this country with call centre the only booming industry and little more than agriculture expanding in Mindanao, I can't see much change coming to ruin our pussy paridise. I read about the pres saying Mindanao being the "next big growth area" and then I saw that the opportunities given were things like a couple oil palm and other agricultural proposals over then next several years. Not much to make any big difference. And violence continues. A bus was blown up and killed a lot of people close to where I was close to the time I was there in Bukidnon. threats are so much that I recently did a news search for bomb exploded and Philippines was one of the top 3 countries appearing in search results.

Now for the document which I found out is from a very credible source and is the most often quoted in reference to developing nations industrializing. The complete absence of Philippines in here is a clear indication of just how much a laggard it will be in development. Even small players in the industry, considered to have minimal activity in manufacturing like Greece and Ireland still have a spot. If small Ireland beat Philippines (a country that needs to support over 100 million people) like this, then you know that any industrialization expect will be so little, noone will be able to even notice any changes. Philippines being left out means it has zip zero nada prospects for a new wave of development. Performing so severely in this report is likely a sign of how any general development will be.
http://www2.deloitte.com/content/dam/Del..._15_12.pdf

All this means that it will continue to be the "sick man of asia" servicing the west in outsourcing business using low wages as its primary competitiveness and low wages mean continued poverty. Which means good news for us rooshv forums members and bad news for everyone else.

BPO wages on average are MUCH higher than typical fields like teaching, nursing, constuction, etc., in the Philippines.

Nurses will start around 8-10K pesos per month here while a kid fresh out of school can work BPO and start at 25K a month. Directors, team leads and manager can make north of 50-60K.

People beat up on the BPO industry in the Philippines but it's been an absolute boom to the consumption economy and economy at large. It has also had numerous other direct and indirect benefits.

Making English a national language was one of the best things Filipinos did and it will benefit them for years and years to come. I wonder where this country would be without English (English allows for easy overseas employment too).

Combined with remittances (which are 9% of GDP and over $23USD Billion annually), BPO makes up a huge chunk of the economy.

Yes, manufacturing is weak here but it's getting better (as is the economy as whole) and that report is ranking countries in terms of competitiveness. No surprise the Philippines isn't there with its high energy costs, high Manila wage costs (compared to other Asian countries), and the refusal of the Philippine government to allow true FDI.

In this Deloitte paper they predict manufacturing, along with BPO as a close second, will see the highest growth in the country among all sectors:"The Philippines: Asia’s next tiger?"

It outlines why China's rising costs of manufacturing could be, if not fucked up, a boon to the Philippine economy.

Of course, the country still faces countless issues that may take a generation or two to resolve: 50 families take 75%, corruption, refusal to allow true FDI, a serious lack of leadership (maybe due to 300+ years of colonial rule), lazier/carefree culture, inefficiency, clanish behavior, overly influential church, legacy of the Marcos regime and it's protectionist polices, etc., etc., etc.

The country has a SHIT TON of things to get over.

But, it does seem like things are getting better and the Philippines only ranks behind China in terms of fastest growing GDP in Asia.

But, Mindanao, your point about manufacturing is taken and that Deloitte paper speaks to it. It's a key to making the future better here.

I just interviewed two kids fresh out of La Salle and they are very 'American' like in their goals, creativity, aspirations, and seemingly their work ethic. Or course these kids went to private school their entire lives and represent the top 10%, but regardless there are people here that know what hard work is and are willingly to make the sacrifices for a better life. The hope is more and more of these people can lead the country into the future.

(01-17-2015 08:14 PM)mindanao Wrote:  All this means that it will continue to be the "sick man of asia" servicing the west in outsourcing business using low wages as its primary competitiveness and low wages mean continued poverty. Which means good news for us rooshv forums members and bad news for everyone else.

I disagree with your assessment as does Deloitte in this paper. I don't know if I'm bullish on the place, but it will get better no doubt.

To say there's 'zero, zip, nada' chance of growth is simply wrong. This place had nearly a 7% GDP growth rate in 2013-14.

Asia is set for HUGE growth over the coming decades. The Philippines will be part of that.

The issues with Philippines manufacturing are:

- highest energy cost in Asia. This is biggest issue here right now and is why companies like Samsung went to Vietnam instead of the Phils (source)
- lack of leadership
- lack of engineers and scientists

The Philippines is producing the 2nd most geothermal energy in the world after the USA at the moment. They need to move faster but the opportunities are here. They could have very cheap, abundant energy in they play their cards right.

To me, leadership is key to all this. They have the resources and manpower to be a tiger. But will they rise up and do it? I think it takes great leaders to make that happen. Hopefully the people will, despite the corruption and vote buying, put the right people in office to make it happen.

Will it remain a poosy paradise? I think some guys are already saying the good days are gone but to me it's still pretty fucking nice.

Good discussion.

(01-17-2015 11:37 PM)YardDog Wrote:  BPO wages on average are MUCH higher than typical fields like teaching, nursing, constuction, etc., in the Philippines.

Nurses will start around 8-10K pesos per month here while a kid fresh out of school can work BPO and start at 25K a month. Directors, team leads and manager can make north of 50-60K.

People beat up on the BPO industry in the Philippines but it's been an absolute boom to the consumption economy and economy at large. It has also had numerous other direct and indirect benefits.

Making English a national language was one of the best things Filipinos did and it will benefit them for years and years to come. I wonder where this country would be without English (English allows for easy overseas employment too).

Combined with remittances (which are 9% of GDP and over $23USD Billion annually), BPO makes up a huge chunk of the economy.

Yes, manufacturing is weak here but it's getting better (as is the economy as whole) and that report is ranking countries in terms of competitiveness. No surprise the Philippines isn't there with its high energy costs, high Manila wage costs (compared to other Asian countries), and the refusal of the Philippine government to allow true FDI.

In this Deloitte paper they predict manufacturing, along with BPO as a close second, will see the highest growth in the country among all sectors:"The Philippines: Asia’s next tiger?"

It outlines why China's rising costs of manufacturing could be, if not fucked up, a boon to the Philippine economy.

Of course, the country still faces countless issues that may take a generation or two to resolve: 50 families take 75%, corruption, refusal to allow true FDI, a serious lack of leadership (maybe due to 300+ years of colonial rule), lazier/carefree culture, inefficiency, clanish behavior, overly influential church, legacy of the Marcos regime and it's protectionist polices, etc., etc., etc.

The country has a SHIT TON of things to get over.

But, it does seem like things are getting better and the Philippines only ranks behind China in terms of fastest growing GDP in Asia.

But, Mindanao, your point about manufacturing is taken and that Deloitte paper speaks to it. It's a key to making the future better here.

I just interviewed two kids fresh out of La Salle and they are very 'American' like in their goals, creativity, aspirations, and seemingly their work ethic. Or course these kids went to private school their entire lives and represent the top 10%, but regardless there are people here that know what hard work is and are willingly to make the sacrifices for a better life. The hope is more and more of these people can lead the country into the future.

Yes true. Manufacturing is serious. In general if Philippines does not show up as even remotely competitive in manufacturing in this report, then don't expect it to be a player on the world stage plain and simple. There are too many factors leaving the Philippines behind. China will hols onto a mothers share of manufacturing due to supply chain. What high end it does let go of, which will be minimal would go to one of the countries that is already healily advanced in it like Mexico, India and USA. Manufacturing trends are going more to manufacturing closer to the destination countries for the products. So USA will get it done in North America. Asia will get it done in China India and Indonesia. Indonesia will absorb what little expansion is needed outside of China in higher end manufacturing. And this new "Make in India" will eat away at some demand for exports cuz this big nation will make its own. I hear Philippines is so backwards in it, it is a net importer of not only manufactured good but agricultural goods for crying out loud! So the higher end stuff is being made in countries that are technically advanced in it and the lower end investments get sent to countries like Bangladesh, a country that did not even make it to the list, but along with Pakistan, beat Philippines too in this sense. Then there are the problems fromrigth here. Electricity costs are among the highest in the world and that scares away FDI. That combined with the FDI laws you mentioned take a huge hit on this countries opportunities. Also you might notice there is actually no room for port facilities to be build. The whole zone is congested to capacity already and they can't expand the area for ports anywhere on the coast cuz its all taken up. So no room for exports to be carried out. Also it seems like Philippines has an issue with industrial zones. There is no space for any in places that have all the needed population with access to port facilities, industrial land zoning and rail transport. The only area the country has space alongside population appears to be in Cavite and this covers a small percentage of the population. If the same source says manufactiring is one of the things that will see growth, then whatever amount it is, it will make no noticable difference cuz even vietnam which is a poor country becoming a big player in this aint getting rich overnight so Philippines manufacturing or at leasts its effects on the country will be nominal even with measurable increases. So it does not surprise me how absent the Philippines is in the report. Too many things are aaginst manufactring, many problems that can't be fixed, at least not with the way the government prioritizes things. It would take a miracle makover of the country just to allow manufacturing to get going and even failing on one aspect such as say port facilities, the whole thing would still fail. So these structural features are what shape the future here.

Funny we are talking about this in this forum. Yet it is the difference between lots of manufacturing and none that will mean the difference between continuation of pussy paradise and its complete oblideration.

On a final note, I am glad about the call centre industry stimulation though. First of all, it only has so much room for expansion. It is not good for sky-is-the-limit type growth. And the subset of the population that works in these more improved areas appear to be easier to game. Notice how the poorest are conservative and only talk about church! If this country were any poorer they would all be like that. But if it were all more well off like Malaysia, it cold be bitch shield going up. So there is a nice balance with the poor weighing down the country, making foreigner value high and the subsection of the population that benefits from increased employment that is neither conservative like the dirt poor nor with bitch sheild like more developed nations. perfect balance whci I think will be maintained as long as this current setup with call center dominating holding on.

(01-18-2015 12:10 AM)YardDog Wrote:  

(01-17-2015 08:14 PM)mindanao Wrote:  All this means that it will continue to be the "sick man of asia" servicing the west in outsourcing business using low wages as its primary competitiveness and low wages mean continued poverty. Which means good news for us rooshv forums members and bad news for everyone else.

I disagree with your assessment as does Deloitte in this paper. I don't know if I'm bullish on the place, but it will get better no doubt.

To say there's 'zero, zip, nada' chance of growth is simply wrong. This place had nearly a 7% GDP growth rate in 2013-14.

Asia is set for HUGE growth over the coming decades. The Philippines will be part of that.

The issues with Philippines manufacturing are:

- highest energy cost in Asia. This is biggest issue here right now and is why companies like Samsung went to Vietnam instead of the Phils (source)
- lack of leadership
- lack of engineers and scientists

The Philippines is producing the 2nd most geothermal energy in the world after the USA at the moment. They need to move faster but the opportunities are here. They could have very cheap, abundant energy in they play their cards right.

To me, leadership is key to all this. They have the resources and manpower to be a tiger. But will they rise up and do it? I think it takes great leaders to make that happen. Hopefully the people will, despite the corruption and vote buying, put the right people in office to make it happen.

Will it remain a poosy paradise? I think some guys are already saying the good days are gone but to me it's still pretty fucking nice.

Good discussion.

Yes I think it is still great lol

But I was talking about the zip nada thing for a specific thing you lleft out. Philippines is being noted as having one of the largest growing economies in the world BUT hugely ironically, it is also apparently one of the few nations with stagnation in improvement of poverty as well as stagnated wages. It is not about how big the economy is growing but what effect any growth has on the poor masses. In this case, this immense growth is getting pocket by the rich. They are exploiting there people and all this growth i wealth is going into these guys' pockets in one of the worlds most clasic examples of severe and worsening inequality.. So yes it is a hugely booming economy but one of the least inclusive in the world. Colombia and Brazil are known for having terrible inequality yet this country blows them all away in the magnitide of its inequality situation. So while the economy grows a lot all the wealth goes into a certain part of the population only. Wages are being kept low and as long as they do this, they remain poor while the elite keep getting richer faster. The currently trajectory has been Philippines having a fast growing economy with the poor being left behind. so that means that the economy can keep exploding like this and the poor stay poor like this even if the economy seems to keep getting better. Notice that most of the super fast growing economies are very poor nations with no real signs of becoming like Canada which jas slow growth but the best living contisiotns in the world. Inequality is swallowing the growth in these poor countries.

The Philippines will remain the sick man of Asia for the foreseeable future.There's no structural change occurring, and the birth rate remains very high, unlike say Vietnam or Thailand which already have lower birth rates reflecting greatly increased prosperity.

--- Wages ---

But wages are growing at 7% a year here. That's why retention is an issue. That's double the inflation rate.

Wages are not suffering from stagnation here in Manila. They are growing and so is the GDP. I'm not sure what you're referring to when you say they are not. Maybe the farm areas? That's the same worldwide, it's just farmers and rural folks get gov. subsidies in the USA.

Look, I don't want to be in the position of defending the economy here as I think it's horrible inept too, but it's simply a fact that it will grow and improve.

Yes, 50% of people here are dirt poor. Unfortunately the poor that are poor today will remain so. It's not going to change for them. The hope is for the following generations.

I agree this country has a mountain of issues, but it will see huge growth over the next 50 years.

I would invite you to read the entire paper by Deloitte on the Philippines economy and research about wage growth here.

--- BPO ---

This is something I really have to disagree with you on. Actually BPO can grow a lot more here. I don't know why you think it cannot. In fact it is growing at around 5% a year and is predicted to keep that pace for the next 20 years. Again, I would invite you to read the research papers from investment banks.

The online service economy is very young. More and more process will happen virtually. The internet is only 20 years old man! Think about that for a minute.

What experience do you have with BPO here in Manila or the Philippines? It's not just 'customer support'. It's far more than that and is moving into second level processes like accounting, banking, documentation, development, consulting, etc. It will continue to grow rapidly over the next 20 years.

Also, the indirect benefits of having a large workforce that has worked in USA style conditions can't be understated. Those people filter into other sectors with experience in a fast pace, western style economy.

Comparing the Philippines to other countries, like Brazil is apples and oranges. This place is starting from a far lower place and just came out of 300+ years of colonial rule and poor leadership.

I live and work here in Manila. I come in to contact with professionals here frequently. Most say it has never been this good. Things are improving overall. Will the millions of poor get taken along for the ride? Probably not, but the hope is the middle class and up will create a better future.

And again, I completely agree that the top 1% takes far too much. This place will never be like Canada or the USA, at least not for generations and generations. But I think it's safe to say that wages are improving, more are moving into the middle class and sectors like manufacturing are set to grow.

You seem to think that manufacturing will not grow here while Deloittle, JP Morgan, and Goldman all think it will boom over the next 20 years with ove 5% annual growth. We'll see who's right.

The brightest and most accomplished Filipinos I know are all raised or educated overseas. That is the reality. There's nothing inherently "inferior" about Filipinos when they are abroad in the right environment they tend to do really well. I know tons of Filipinos in CA and elsewhere who are easily a match for the most well educated top tier asian-americans on a 1:1 level in academia or professional capability.

The combination of crushing factors in the Philippines creates insurmountable hurdles. The wealthy and the powerful stymie development. They are backwards colonials who are still counting their pesos in luxury villas equipped with stripper poles and strobes. Meralco, SM, all telecom, etc.. are family monopolies. This will not change anytime soon. Commodities, energy, telecom etc.. is controlled unless you have a plan of action to dismantle their private armies and play Game of Thrones with their assassination teams. This is a country where people get whacked at the airport with no legit "culprits" ever implicated. Just think about that. I won't even get into the hijinks in the provinces. No one wants to get involved with that and geopolitical factors keeps them in power anyways.

FDI is just one issue but the bigger issue is how much development is wasted. The P.I. actually has decent resources and good potential for renewable agricultural crops but all of it is wasted on nonsense like old sugar cane monopolies.

But, let's get back to the poosy paradise talk. Yes, it'll be good for some time to come for expats with means. For the local people? Not so much.

I'm not down on BPO but it's still a service heavy industry based on low skill level. It should not be the middle class aspiration out of poverty. It's a very short sighted and limited industry.

(01-18-2015 01:18 AM)El Chinito loco Wrote:  The combination of crushing factors in the Philippines creates insurmountable hurdles. The wealthy and the powerful stymie development. They are backwards colonials who are still counting their pesos in luxury villas equipped with stripper poles and strobes. Meralco, SM, all telecom, etc.. are family monopolies. This will not change anytime soon. Commodities, energy, telecom etc.. is controlled unless you have a plan of action to dismantle their private armies and play Game of Thrones with their assassination teams. This is a country where people get whacked at the airport with no legit "culprits" ever implicated. Just think about that. I won't even get into the hijinks in the provinces. No one wants to get involved with that and geopolitical factors keeps them in power anyways.

Yeah, that's a problem. Insurmountable? Might be, but leadership could potential change the game along with a more globally in tuned mass of educated locals.

This is why FDI and the opening of the economy here will be such a huge battle. The old guard will fight it but almost all educated locals are promoting the opening. We'll see who will win.

(01-18-2015 01:18 AM)El Chinito loco Wrote:  I'm not down on BPO but it's still a service heavy industry based on low skill level. It should not be the middle class aspiration out of poverty. It's a very short sighted and limited industry.

Man, to me it's the one of the best deals possible right now for locals. First off you have to have degree. You get paid 3X - 4x compared to the local economy, and it's not just low skill. I don't know why you think that.

Are accounting, consulting, development, financial analysis, IT engineering, etc., low skill?

What's your experience living in Manila and with BPO here? Are you aware that it's more than just answering phones and is evolving into second tier processes?

To me I think it's a boon to have foreign companies here. It ups the local wages (it has done this), teaches Filipinos Western style business trades and how the companies function, filters workers back into other sectors, and integrates the Philippines into the global economy.

Also, if workers get experience with local BPO here they have a better shot of migrating out with their skills.

Without BPO Manila would be a far bigger shithole than it already is.

(01-18-2015 01:50 AM)YardDog Wrote:  Yeah, that's a problem. Insurmountable? Might be, but leadership could potential change the game along with a more globally in tuned mass of educated locals.

Leadership is the problem that's why it's insurmountable. You have an immense portion of wealth and power controlled by a tiny fraction of the population. Even voter narrative is controlled. People's party..heh..political stagecraft.

Quote:This is why FDI and the opening of the economy here will be such a huge battle. The old guard will fight it but almost all educated locals are promoting the opening. We'll see who will win.

The old guard has no interest and if so they will use direct investment to enrich their own. It's how things are done in the P.I. This is why they alienated a lot of outside investment firms back in the day. The unbridled venality was unique even for SEA.

Quote:Man, to me it's the one of the best deals possible right now for locals. First off you have to have degree. You get paid 3X - 4x compared to the local economy, and it's not just low skill. I don't know why you think that.

On a very limited basis it's attractive but it doesn't develop groundbreaking skillsets or nation building industry. It's a language orientated service industry.

Quote:Are accounting, consulting, development, financial analysis, IT engineering, etc., low skill?

Are filipinos renknown for IT, engineering, accounting, consulting, or development within Asia? Do you see these people making groundbreaking contributions on large projects around Asia? If not..why? How many branded international companies have a filipino name behind it?

Quote:What's your experience living in Manila and with BPO here? Are you aware that it's more than just answering phones and is evolving into second tier processes?

It's very shallow in the broader economic pool. I have lots of experience with the lifestyle, first hand pros, and the industry behind it.

Quote:To me I think it's a boon to have foreign companies.

Yes it is. That's the prime beneficiary...foreign companies reducing 25-30% of overhead.

Quote:It ups the local wages (it has done this), teaches Filipinos Western style business trades and how the companies function, filters workers back into other sectors, and integrates the Philippines into the global economy.

As opposed to mass land reform, getting rid of agricultural monopolies, utility/commodities monopolies, and setting the population on an industrial growth path? BPO is a tiny drop in that pool of reform.

Quote:Also, if workers get experience with local BPO here they have a better shot of migrating out with their skills.

Yes..a population of expatriate staff for the rest of the developing world.

A great foundation to build on.

Quote:Without BPO Manila would be a far bigger shithole than it already is.

I'm not against BPO but there is the other reality which is much harder and bloodier to realize. It's a necessity unfortunately.

You seem like a sharp guy, but I'd appreciate if you wouldn't suggest I held positions that I don't. You've setup a number of this/that, black/white dynamics that don't exist.

Simply put, if you lived here you would know that most people consider the success of the BPO industry to be a very good thing. I really don't want to spend hours writing why. Sit down with some local Filipino business people and they'll tell you. Have a girl pick you up in a brand new car she earned from working at JP Morgan and she'll tell you. They benefits are far and wide.

I did not suggest this is some sort of God send that will lift the country out of poverty. I simply said it’s been a boon and it has. There’s no really denying that yet. Does that statement somehow mean I believe they shouldn't develop more robust and larger industries? Come on man, only a fool would say or think that.

(01-18-2015 02:43 AM)El Chinito loco Wrote:  On a very limited basis it's attractive but it doesn't develop groundbreaking skillsets or nation building industry. It's a language orientated service industry.

Sure I agree. I never argued otherwise. But I think you’re not giving it enough credit. This industry has a big impact directly and indirectly. They are doing jobs that Western people do. That’s a huge step up in so many ways.

Of course I don’t think you do nation building on it. Why would I think that?

(01-18-2015 02:43 AM)El Chinito loco Wrote:  Yes it is. That's the prime beneficiary...foreign companies reducing 25-30% of overhead.

Logically that doesn't make any sense. It can be good for both and has. I’m not sure why this is black/white.

(01-18-2015 02:43 AM)El Chinito loco Wrote:  As opposed to mass land reform, getting rid of agricultural monopolies, utility/commodities monopolies, and setting the population on an industrial growth path? BPO is a tiny drop in that pool of reform.

Again, why is this black and white, one or the other? It’s not a tiny drop, but it’s small (5-10% of GDP and set to grow 5% annually for the next 20 years). But I would never suggest that industry shouldn't take priority. You're arguing against a position I don’t even hold.

(01-18-2015 02:43 AM)El Chinito loco Wrote:  It's very shallow in the broader economic pool. I have lots of experience with the lifestyle, first hand pros, and the industry behind it.

That's cool, but it doesn't tell me if you have any direct experience living long term here or with the local BPO sector.

(01-18-2015 02:43 AM)El Chinito loco Wrote:  Yes..a population of expatriate staff for the rest of the developing world. A great foundation to build on.

Ugh, again why is this one or the other. Yes, it is good for them. Does that mean I think this is a great foundation to build on? Did I say that? Either way it is a good benefit for the people. Imagine living in a country with little opportunity to gain skills that are transferable. I know BPO helps Filipinos with that. I've seen it firsthand.

(01-18-2015 02:43 AM)El Chinito loco Wrote:  Are filipinos renknown for IT, engineering, accounting, consulting, or development within Asia? Do you see these people making groundbreaking contributions on large projects around Asia? If not..why? How many branded international companies have a filipino name behind it?

What does this have to do with anything I wrote? I said there are Filipinos doing those jobs here for foreign firms. That's a fact. And I also believe that experience they gain will benefit both themselves and the country as a whole.

Yeah, I agree with your sentiment. Filipinos are not contributing anything substantial globally. But that's not what we're talking about, is it?

(01-18-2015 02:43 AM)El Chinito loco Wrote:  I'm not against BPO but there is the other reality which is much harder and bloodier to realize. It's a necessity unfortunately.

Again, why is it one or the other? Filipinos working in BPO doesn't inhibit any other sector from developing. Of course they should be tackling the hard stuff. But what does BPO have to do with that? Not sure the connection you're making. Politicians actually push manufacturing far more than BPO. BPO has really grown despite the local ineptitude because of the workforce.

Nuanced discussion is hard online. It's probably best to discuss stuff like this over a beer in Manila. I agree with much of your overall sentiment, but I think it's regarded locally as a fact that BPO has a been a bright spot here. I haven't heard a convincing argument to the contrary.

(01-18-2015 04:03 AM)YardDog Wrote:  You seem like a sharp guy, but I'd appreciate if you wouldn't suggest I held positions that I don't. You've setup a number of this/that, black/white dynamics that don't exist.

If you don't agree with something I say then repeat and give your rebuttal. I'm not passive-aggressive or avoidant. I don't believe i've mispresented anything you've said or "set up" black/white dynamics or any such thing. Speak your mind, by all means. This is what we are here for.

Quote:Simply put, if you lived here you would know that most people consider the success of the BPO industry to be a very good thing. I really don't want to spend hours writing why.

Let me just say the BPO industry is good but it's not the panacea or the industry that will bring the P.I. out of its long deep malaise. It's like the bandaid on the shotgun wound. It has its usefulness but it's very limited in scope.

Quote:Sit down with some local Filipino business people and they'll tell you. Have a girl pick you up in a brand new car she earned from working at JP Morgan and she'll tell you. They benefits are far and wide.

I agree there are some middle class Filipinos created from the BPO boom but it's such a small tiny minority. It's nothing and not a long term solution to anything.

Quote:Again, why is it one or the other? Filipinos working in BPO doesn't inhibit any other sector from developing. Of course they should be tackling the hard stuff. But what does BPO have to do with that? Not sure the connection you're making. Politicians actually push manufacturing far more than BPO. BPO has really grown despite the local ineptitude because of the workforce.

Where did I rail against BPO?

You guys trying to predict macroeconomic trends...it makes for some good conversation, but don't get too worked up about your opinions. Why? Because you are most likely wrong.

Who knew that South Korea would go from Sub-Saharan Africa levels of poverty to developed status in a few decades?
Who predicted China's growth in the 80s?
Who saw Thailand's rise to prosperity coming?

Pretty much nobody.

Same goes for the Philippines. No consulting firm can tell you where the country is going to be in 20 years.

Personally, I think that the Philippines is destined for some impressive growth. Are they the next China? Probably not, but look at the wider region of Southeast Asia and you see rapid growth wherever you look. Historically, wealth tends to spread geographically. Places like Singapore, Vietnam and Thailand might be leading the way but other countries nearby will benefit with time.

In any case, I wish the Filipinos well and hope their economy continues to develop. A country staying in dire poverty is not "good news" for Rooshvers. We are better than that here.

I enjoyed reading the economic discussion so far. Surprisingly knowledgeable and civil on all sides.

Having hung out with YardDog a couple times in Manila I certainly give his experience and opinions some credibility. He is directly working with Filipinos in the industry and by all our conversations has a great deal of knowledge on the subject.

I am amused when I hear people say that there is no or very little middle class in the Philippines, 40 families control 99% of the wealth, etc, etc.

Sure the country has some serious corruption, a lot of frustratingly incompetent admin, and an ultra wealthy elite, but the net situation now and for the forseeable future is growth and improvement.

There is clearly a fast growing middle class.
Take 3 basic markers ..

Home ownership: Massive scale western standard house and apartment construction and sales in recent years and presently. Sure, bubbles will pop from time to time, but the overall effect is there.

Car ownership: Just stand beside any roads in Manila and look at the traffic, or watch a Youtube video. Sure there are lots of jeepneys, but the big majority of traffic creating the congestion is people driving modern mid range cars.

Retail sales: Walk around the crowded, seemingly never ending western style shopping malls. Sure, a lot of people are just hanging out, but many are buying stuff. Retailers do not keep expanding if they are not selling stuff.

Spend some time in former Soviet states and apply those markers, plus consider their shrinking populations, and note the contrast.

(01-18-2015 01:18 AM)El Chinito loco Wrote:  The brightest and most accomplished Filipinos I know are all raised or educated overseas. That is the reality. There's nothing inherently "inferior" about Filipinos when they are abroad in the right environment they tend to do really well. I know tons of Filipinos in CA and elsewhere who are easily a match for the most well educated top tier asian-americans on a 1:1 level in academia or professional capability.

The combination of crushing factors in the Philippines creates insurmountable hurdles. The wealthy and the powerful stymie development. They are backwards colonials who are still counting their pesos in luxury villas equipped with stripper poles and strobes. Meralco, SM, all telecom, etc.. are family monopolies. This will not change anytime soon. Commodities, energy, telecom etc.. is controlled unless you have a plan of action to dismantle their private armies and play Game of Thrones with their assassination teams. This is a country where people get whacked at the airport with no legit "culprits" ever implicated. Just think about that. I won't even get into the hijinks in the provinces. No one wants to get involved with that and geopolitical factors keeps them in power anyways.

FDI is just one issue but the bigger issue is how much development is wasted. The P.I. actually has decent resources and good potential for renewable agricultural crops but all of it is wasted on nonsense like old sugar cane monopolies.

But, let's get back to the poosy paradise talk. Yes, it'll be good for some time to come for expats with means. For the local people? Not so much.

I'm not down on BPO but it's still a service heavy industry based on low skill level. It should not be the middle class aspiration out of poverty. It's a very short sighted and limited industry.

Yes i do agree with the bold. It is true about that. Philippines only benefits from the voice part because of spoken English. But the rest of the outsourcing stuff gets absorbed by India and many other places cu the other stuff does not necessarily need the English speaking Philippines population. I also don't see structural change. Those behind the current set up LOVE the setup which is getting those involved rich so they won't let it change. I read about the unemployment and poverty rates having poorer rate of improvement here than most poor places in the world This is even with the booming BPO. Besides, I think all the growth in BPO just gets absorbed by masses of people that would have otherwise picked up and left to go abroad. So the more it can grow, the more people decide to stay and compete with the masses already here. Until the Philippines stops having millions slaving in other bad countries just to find a job, then you won't see much improvement overall I think, cuz there are millions there waiting there to come back and scoop up any new jobs that come from growth. So that is likely why the situation wont get much better: there are millions overseas ready to absorb any job increases back home so to ever more congest the country. But yes, back to the pussy paradise, all this means that the cercumstanes that made the pussy paradise to begin with aren't going to change fast enough for us to notice any changes in the near future.

(01-18-2015 05:17 AM)El Chinito loco Wrote:  Let me just say the BPO industry is good but it's not the panacea or the industry that will bring the P.I. out of its long deep malaise. It's like the bandaid on the shotgun wound. It has its usefulness but it's very limited in scope.

That's true. People that work in call centre are still living in squatter area. Supporting their families with that wage. the welath is absorbed by the non working portion of families. So it gives some added work, but don't expect a change in the landscape in any way as a result. You won't be walking down clean sidewalks with green grass on both sides, seeing mazdas and Audis ruling the roads in place of jeepneys, posh restaurants on every corner and so much more ... like Canada as a result of outsourcing. It is only there cuz the wages are already super poor and this will only conitinue if the Philippines remains poor. It is not like manufacturing. Philippines only gets jobs that use its low wages. Manufacturing grows where the supply chains while this here flourishes off the poor wages they need to keep to keep the industry competitive.

^ I have worked on projects where the software development was in the Philippines and not in India. What a joy it was to work with people who not only spoke English extremely well, but were also very, very bright, not racist, not ruthless, and on the whole humble and truthful in business.

If the west were smart they would be outsourcing all their software/IT work to the Philippines. Of course, some already are.

When people I know discover I went to the Philippines and ask why, I say because they all speak English. Then they respond, "Really, I didn't know that."

It's amazing how most American men don't know anything about the Philippines.

(01-19-2015 09:21 PM)mindanao Wrote:  People that work in call centre are still living in squatter area.

Man, that's about as inaccurate of a statement as you could make.

What is your experience working and living in Manila long term? What is your experience with BPO here?

I was going to drop this topic but your statement is so off base I think it deserves a more thorough reply. I also worry some guys might actually believe something like 'People that work in call centre are still living in squatter area.' if they read it on the Internet.

Maybe I can convince some folks here that BPO actually is a big deal for the Philippines. Yes, it's not like a world class auto manufacturing sector, but we're talking about the Phils here guys.

Wages:

Quote:"According to a survey of the industry by the Philippine central bank, BPO workers earned an average of $8,849 in 2012 - almost three times the minimum wage in Manila."

That's nearly 34,000 pesos per month (and this was 2012 so it's likely 38,000 or more now). You know what guys working construction make here? About 10-20K a month. Same for nurses in their first 0-5 years.

Ask anyone that actually lives long term in Manila if 34K is a decent wage and they will tell that yes, it is.

That's just average. If you make $9000 a year and live in a squatter area that's by choice. Maybe you know a girl or two that did to help her family. But 99% do not. Unless you consider average Filipino neighborhoods 'squatter areas'.

I guess you completely ignored my previous post where I showed you wages are increasing at double the inflation rate here (7%) too.

Growth:

Quote:"In 2013, the BPO industry generated $15.5 billion in revenue and employed 900,000 people, up from $3.2 billion and 240,000 people in 2006, according to the IT and Business Process Association of the Philippines, (IBPAP). According to projections, by 2016, outsourcing may generate $25 billion in revenue and employ 1.3 million people, matching cash remittances from overseas Filipinos for the first time. BPO income has already surpassed tourism as the second largest source of foreign revenue for the country."

That is absolutely fucking insane level growth and again, has been a boon to this desperately poor nation. This has nothing to do with manufacturing. It's not one or the other so please stop that strange dynamic that keeps getting thrown around. The country is pursing manufacturing more than any other sector (no shit).

Also, it's not just 'call center' work they are doing. Your lack of what BPO is in Manila really is quite clear on this point. Do you think the 1000s of people working in banking are just answering phones? lol man.

There are many fields that comprise BPO and the sector is getting deeper, the jobs more complex and they pay is growing.

Future

When India started it was mostly all voice too. Look where they are now. Why would you think the Philippines wouldn't take this amazing start into internet technology and parlay it into other fields? I think in many ways the Philippines has a higher growth ceiling in BPO because they are culturally the most Western Asians. Manila has already overtaken many Indian cities and will continue to do so.

It all starts somewhere.

Quote:"The BPO industry allows Filipinos to earn a similar salary while remaining in the country, thereby reducing the brain drain of Filipino professionals to other nations"

“Western businesses get to tap into amazing talent for a fraction of the cost of hiring the same roles in America, and Filipinos get to do meaningful work for interesting companies, acquire world-class skills, and earn a good wage.”

I don't think you understand how huge Filipinos doing Western style jobs in their own country really is. This ups the playing field on some many levels. Ask any local business owner or politician. It has helped the Philippines become familiar with how Western style economies and business run. If you can't understand the power of that and benefits it holds then I have no idea what to say.

This is just a start. But the success of BPO here is going to benefit this country for years to come.

But I don't even need to predict the future because it's already happening.

I know this post may come off as 'getting worked up', but I think guys just saying shit like 'BPO is short-sighed and low level' and 'People that work in call center are still living in squatter area' plain and simple have no idea what they are talking about on this subject and what it's done for the Phils (Manila in particular).

We are talking about the Philippines, not Canada. For this country, at this time, it undeniably has been a huge boon.

It has helped 100,000s of people live a middle (and above) class life here and will continue to do so. Go ahead and sneer and dismiss it, I don't think people who actually live and work here will.