Abstract
The Philippines is often referred to as a country from which export of services rather than manufactured goods is the principal engine for economic growth, as the share of the service sector in gross domestic product has exceeded that of the industry sector since the mid-1980s. Three major opportunities for leveraging service sector growth stands out. One is expanding the scale and scope of the export and domestic markets for information technology-business process outsourcing and other modern services in urban areas. Second is expanding tourism to foster economic development across social groups and regions including poor and remote rural areas. Third is enhancing the domestic prospects for Filipino technical, managerial, and entrepreneurial talent so they will work in the Philippines rather than overseas. To take advantage of those opportunities, there is a need for concerted efforts to improve infrastructure; logistics; broadband connections; the power supply; and education, healthcare, financial, legal, and public administration services and more generally the overall business environment for foreign investors and local entrepreneurs.
Highlights
It has become popular to argue that service industries such as information technology-business process outsourcing (IT-BPO) and tourism can serve as principal drivers to achieving sustainable and inclusive economic growth for the Philippines and for other developing countries (Ghani 2010, Pasadilla 2006)
How will IT-BPO and tourism evolve in the Philippines in the 2010s and beyond? In addition, what are the prospects for migration and its impact on exporting services? This study examines the dynamics of the development of the service sector in the Philippines in a historical and comparative review based on a synthesis of secondary information and interviews
Sustainable, inclusive social and economic development is based on developing both the goods-producing, and service sectors and the interface between them because services like education, healthcare, banking, legal systems, information and communication technology (ICT), and logistics are fundamentally important for goods-producing sectors and vice versa
Summary
It has become popular to argue that service industries such as information technology-business process outsourcing (IT-BPO) and tourism can serve as principal drivers to achieving sustainable and inclusive economic growth for the Philippines and for other developing countries (Ghani 2010, Pasadilla 2006). The Bangko Sentral ng Pilipinas (BSP, the Philippine central bank) and industry associations have made efforts to improve the reporting of basic revenue and employment data. One particular knowledge gap is the lack of information on the impact of developing export services on different social groups and on productivity. Several reports have been issued on growth trends in the industry, but its impact on economic growth and on social groups is typically not a principal focus. There is little regularly published information on the impact of migration beyond general data on the number of migrants and the BSP’s reporting on remittances from Filipinos working overseas
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