Western Visayas, the most populous region in Visayas, is a major economic contributor to the country. In 2016, the gross regional domestic product (GRDP) of the region grew by 6.1% from P305 billion to P324 billion, the sixth highest amount nationwide.
Though the pace of growth was slower than in 2015, when GRDP increased by 8.8%, Ro-Ann A. Bacal, Region VI director of National Economic and Development Authority, noted in a press conference the trends in the region that signified that its economy is healthy. Among these were the declines in inflation and underemployment, and increases in employment, exports and tourist arrivals.
The business process outsourcing industry (BPO), Ms. Bacal added, remained one of the region’s major job generators. A total of 47 BPO offices were set up in 2016, and together they employed about 21,500 people. Also that year, the industry posted $22.6 million in revenue, exceeding the 2015 revenue of $22.4 million.
Western Visayas is doing well as a whole. But Iloilo and its namesake capital city are the ones making decidedly significant splash. A quick scan of the corporate and economic news of the past few years suggests that the province and the city are increasingly attractive to both local and international investors.
On the BPO front, some of the country’s top real estate companies are aggressively building offices in Iloilo City. Last year, it was reported that Andrew L. Tan’s Megaworld Corp. was going to spend P5 billion to put up four to five buildings within the next three years in the Iloilo Business Park it has developed. This would increase the total office space inventory of the mixed-use development to 100,000 square meters (sq. m). By the time the report was released, the park had an office space inventory of 45,000 sq. m.
“During the last three years, we have experienced a spike in the demand for office spaces in Iloilo Business Park. Thus, we expedited the construction of our first four towers and we have decided to build more to see the demand,” Jericho P. Go, senior vice-president at Megaworld, was quoted as saying in news reports.
Adding those buildings would also allow the park to accommodate more BPO workers. In 2016, it was catering to about 15,000 office workers from seven BPO companies. “We continue to see a bright prospect in Iloilo’s BPO industry. Several companies, most of them are first-timers in Iloilo, want to come in and expand here,” Mr. Go said.
According to the real estate consultancy firm Colliers International, BPO firms were driving demand for office spaces in the city. “The government thrust to promote the province as a major investment hub in the Visayas, coupled with the planned projects of the country’s major developers, provides a positive outlook for Iloilo. Companies such as iQor, WNS, Nearsol, and Yazaki Philippines EDS Technoserve took up spaces last year and started operations this year,” Colliers said in its second-quarter provincial property report released last year. Apart from Megaworld, the property developers operating in Iloilo include Ayala Land, Inc., SM Prime Holdings, Inc. and Robinsons Land.
In the 2016 Cities and Municipalities Competitive Index, developed by the National Competitive Council of the Philippines, Iloilo City ranked eighth among highly urbanized cities. “Thus, the provincial city has remained in the radar of foreign BPO investors. The number of educational institutions has also made Iloilo a center for learning in the Visayas region and consequently a viable area for companies to locate in,” Colliers said.
The firm noted that rental rates were among the things that attracted investors. Last year’s second-quarter rates ranged between P250 to P550 per sq. m. “This price is quite attractive for BPO tenants, especially for those looking for alternatives to Metro Manila and Metro Cebu,” it added.
Iloilo did not go unnoticed by foreign investors. In May of last year, 14 businessmen from China went on a four-day mission to Iloilo — particularly the capital and other parts of the province — to study investment opportunities in human resource training, tourism and the BPO sectors. “My purpose of coming over is for business tourism and human resources development training,” Danny Chou of Ambrose Financial Services (H.K) Ltd. was quoted in a BusinessWorld report, adding that his company was also looking at opportunities in the BPO industry and the field of English-language training.
Meanwhile, Mike Moon, trade and investment director at the British Embassy, told a reporter of this paper last year that the British Ambassador to the Philippines Daniel Pruce had visited Iloilo to assess the possibility of supporting development projects.
The Department of Trade and Industry announced in September of last year that an American outsourcing company for clinical services was expanding its operations in Iloilo City this year in order to meet growing customer demand. This expansion by SHEARWATER Health would raise the company’s investment in the country to $7 million and the number of staff to about 3,000.
An economic zone may soon materialize in Iloilo, which will undoubtedly boost the province’s reputation as an attractive investment destination. Last year, a feasibility study conducted by the University of Asia and the Pacific showed that building an ecozone in the province was a viable proposition. “The indicators show that it is sustainable to put up an economic zone in the province considering that it has an adequate water supply, has a port that can be expanded, enough power supply, stable peace and order, and availability of manpower,” Gov. Arthur Defensor, Sr. was quoted in a BusinessWorld report.