An alternative to ‘exodus capitalism’? Offshore services in Iloilo City, Philippines

Abstract

Theoretically informed by the relationships between growth poles and regional development, this article investigates two industries in Iloilo City, a secondary city in the Philippines: business processing outsourcing (BPO) and English as a second language (ESL). The empirical analysis is based on 46 interviews. First, the results of the empirical investigation demonstrate that Iloilo City should be considered a genuine growth pole with a substantial degree of enabling institutions. Yet, two qualifications need to be made. While information technology–business processing outsourcing (IT-BPO) is booming, the ESL industry is still small and is heavily reliant on Korean students. Second, while banking on offshore services enables the Philippines to encourage regional deconcentration, it remains to be seen whether future growth of the IT-BPO and ESL industries will result in attaining inter-regional balance and providing a decent alternative to overseas migration. The implications of the results relate to labour markets, endogenous regional development theories and international integration.

Keywords

• endogenous development
• globalisation
• poverty reduction
• service industries
• growth pole
• regional development
• southeast asia