THE US tariffs on imports from China could drive US companies to intensify their cost-cutting efforts, leading them to consider more outsourcing, to the possible benefit of the Philippine office market, according to property con-sultancy Colliers Philippines.
“It is worth monitoring how (tariffs) would affect BPO (business process outsourcing) demand for office space,” Luis Pantaleon, negotiator for office services, said in a statement.
US President Donald J. Trump imposed a 25% tariff on imports from Canada and Mexico, and an additional 20% tariff on Chinese imports.
“A more practical alternative for US companies would be to cut costs by outsourcing non-core and support functions like customer service, IT (information technology), accounting, human resources, and the like to countries where labor is cheaper without compromising the skillset needed,” Colliers said.
The Philippines remains an attractive market for US companies looking to outsource due to its talent pool and strong service orientation, Colliers said.
It enjoys a time-zone advantage that allows round-the-clock operations for multinationals, with Philippine BPOs operating during the US nights.
Office transaction volume dropped 57% in 2024 due to uncertainty connected with the US election, according to Colliers data. However, net take-up is expected to increase 40% quarter on quarter, judging from past US pre-pandemic election cycles, it added.
Robinsons Land Corp. Senior Vice-President Jericho P. Go cited the need to focus on growth opportunities in the property market, “rather than dwell on external forces which we don’t really have any control of.”
“We would like to be able to look inwards, to be able to find out what we can offer based on what the market is currently demanding,” he said at a briefing on Wednesday.
Risks to the Philippine office market include geopolitical uncertainty and sudden policy shifts, Colliers said.
To ensure the office market’s attractiveness, the government must enhance tax incentives and streamline regulations. It must also leverage public-private partnerships to expand high-speed internet, and continue to upskill the BPO workforce, Colliers said. — Beatriz Marie D. Cruz