[July 03, 2009] WB cites RP impressive growth in IT services Tweet Jun 30, 2009 (Asia Pulse Data Source via COMTEX) -- MANILA, June 30 (PNA) - The Philippines has redefined its international competitiveness with standout performance in the information and communications technology (ICT) sector over the last eight years. In its 2009 Information and Communications for Development report, the World Bank (WB) Group cited the country?s leading role in the provision of both IT and IT-enabled services (ITES). The WB said the Philippines was among the few developing countries to have done particularly well in this sector, with ICT service exports accounting for seven percent of the country?s total service exports. This is better than the average for the East Asia and Pacific region at 5.2 percent. ?Growth of the sector in the Philippines has been impressive: total IT services and ITES reached US$ 6 billion in 2008, up from US$ 100 million in 2001,? the report noted. It added that as of mid-2008, some 345,000 people were employed in the sector, from only 100,000 in 2004. These jobs also typically pay more than others in services. The WB defines trade in ICT services to include telecommunications, business network services, teleconferencing, support services, and postal services among communications services; as well as databases, data processing, software design and development, maintenance and repair, and news agency services among computer and information services. Citing projections from the Business Processing Association of the Philippines (BPAP), the WB report said revenues in the sector could hit us$ 13 billion by 2010, with direct employment for some 600,000 people. Since each new job created in this sector translates to two to three new jobs in other sectors, employment generation could hit as much as 1.2 to 1.8 million. By next year, IT and ITES could account for 8.5 percent of the country?s GDP, it said. By the WB?s reckoning based on various independent studies, the Philippines accounts for one percent of the global market for offshore IT services and 15 percent of ITES. In both sectors, India is the global leader and Canada , the second largest. In ITES, the Philippines occupies the top three slot. ?In countries that have succeeded in the IT services and ITES industries, governments have adopted a proactive role in promoting the sector,? the WB report said. ?Most of the public interventions to promote the industries?improving education, providing broadband infrastructure, or streamlining government interfaces with business?are essentially ?no-regret? moves that carry little risk,? it said. Despite fears of a temporary setback due to the global financial crisis, the WB said the global market for IT services and ITES would continue to be robust. Market size estimates range from US$ 475 billion a year for IT services with less than 15 percent being exploited, according to a McKinsey study. Based on Gartner Research, the market size for ITES was projected to reach US$ 239 billion. The National association of Software and Services Companies (Nasscom) even estimated it to soar to US$ 700 to US$ 800 billion by 2012. Investments in ICT were transformational because they served as a catalyst for fiscal, regulatory, and legal reforms, the WB report said. ?Success in IT services and ITES presents opportunities for repositioning the image of a country, a ?branding? effect that can have profound implications,? according to the study. The sector?s impact is also evident in women empowerment. In the Philippines , about 65 percent of workers in the sector are women. The same is true for other countries like India and Ireland , the WB report noted. Among the standout items in the WB?s ICT profile for the Philippines include 58.9 mobile cellular subscriptions per 100 people, where the averages are only 38.9 among low middle income countries and 43.7 in East Asia and the Pacific; 7.3 personal computers per 100 people, with only 4.6 and 5.6 for low middle income countries and the East Asia and Pacific region, respectively; 99 percent of the population covered by mobile cellular network, as against only 80 percent and 93 percent among its low middle income country and regional peers. But Internet indicators in the country remain sub-par, with only 2.8 per 100 people subscribed to Internet access, while the low middle income country average stands at 6 and in the East Asia and Pacific region, 9.3. In terms of Internet usage in the country, there are 6 per 100 people. Among low middle income countries, this is at 12.4; and for the region, 14.6. Only 19.8 percent of total Internet subscribers have fixed broadband, while the numbers are at around 40 percent among country income and regional peers. The country also scored higher than average in the e-government web measure index and the number of secure Internet servers per one million people, both indicators of sector performance. Close to 50 countries around the world are classified by the WB as low middle income economies. [ Back To TMCnet.com's Homepage ]