With a thriving information technology and business process management (IT-BPM) sector, the Philippines is attracting the attention of American artificial intelligence (AI) firms due to revenues generated and the existing large employment base, according to a Manila Bulletin news report citing the United States Commercial Service (USCS).
To put things in perspective, posted below is the excerpt from the Manila Bulletin report. Some parts in boldface…
The Philippines’ information technology and business process management (IT-BPM) sector has emerged as the most viable investment destination for American artificial intelligence (AI) firms, according to the United States Commercial Service (USCS).
USCS Manila commercial specialist Easter Villanueva said the IT-BPM sector is a promising market for US-based AI companies given the revenues it generates and its large employment base.
“Given the size of this sector, AI could play an important role in modernization, productivity, and movement toward higher value services,” she said in a webinar organized by the USCS last week.
The IT-BPM sector generated more than $40 billion in revenues last year, up five percent from $38 billion in 2024, based on data from the IT and Business Process Association of the Philippines (IBPAP).
IBPAP said the industry employed 1.9 million workers last year, four percent higher than the previous year’s 1.82 million employees.
This year, the IT-BPM industry is expected to generate $42 billion in revenues and create 1.97 million jobs.
As AI threatens to disrupt the industry, Villanueva said the sector is increasingly becoming more open to integrating AI into its operations, especially when it comes to voice-based services.
“I would think that they would be very much willing to explore [AI], since it is also important for workforce development,” said Villanueva.
“They want to also protect the jobs here in this market, [so] they would want to upskill their agents to be able to integrate their daily operations with AI,” she added.
Aside from the IT-BPM sector, other promising industries for American AI companies include digital transformation, financial services, telecommunications, healthcare, energy, infrastructure, and the public sector.
Villanueva said there are also opportunities in cybersecurity, data governance, and responsible AI, especially as companies become more conscious of data privacy and security.
Based on USCS estimates, AI adoption in the country remains limited, with only about 14.9 percent of companies currently using AI tools.
“This is not yet a mature AI market, and many buyers are still learning what AI can do, what it cannot do, how much it will cost, and how results can be measured. For US companies, this means that the opportunity is not only to sell, but also to educate, build trust, and demonstrate practical value,” said Villanueva.
For AI companies looking to enter the market, she said it is critical to make their use case clear by helping address a specific problem with measurable outcomes while offering cost-effective solutions.
She also recommended that firms work with local partners for market access and implementation support, embed data privacy and AI governance measures early, and adopt a consultative approach with buyers.
“Buyers can be price-sensitive, and companies may face competition from lower-cost providers…So the opportunity is real, but it will require patience, education, and a clear business case,” Villanueva said.
Let me end this piece by asking you readers: What is your reaction to this development? Do you think several AI firms in the United States will proceed to tap the IT-BPM sector of the Philippines soon? What kind of business developments do you think will happen once American AI firms start investing in the Philippines’ IT-BPM sector? Do you think political scandals or government-related blunders of the Philippines might discourage American AI companies from investing?
You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.
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Author Carlo Carrasco 
Good news!
For perspective, I’m in Wisconsin, USA with my Filipina (dual citizenship) wife, and we are both close to a data center here and doing construction (on a tiny tiny scale) near Davao. I’m a futurist with a deep interest in our future in The Philippines.
Data centers need lots of cheap electricity. So does manufacturing. So even if the data centers fail for some reason, you have a large building with electric power (though not a lot of parking) in remoter areas (where land is cheaper). This can help shield the country (both yours and mine) from manufacturing shocks if things get worse with China.
Energy prices over there are skyrocketing due to such high dependence on China for refineries. I realize designing local refineries in a country prone to earthquakes would be expensive, but we have both Earthquakes and refineries in California so it can be done. (California politics are a separate topic).
We are currently doing a minor construction project over there despite the fact that it burns our deepest emergency savings because construction prices are also skyrocketing, and we want to get ahead of the cost curve. The tiny rental units will pay for themselves in 10 years now, but never will if we wait for concrete prices to go up with inflation another year. The builders of these data centers are no doubt seeing the same numbers and are trying to get ahead of that.
A solar farm so close to the equator will help with a data center and fuel costs, but not so much during monsoon season. A data center that works “part time” as a sort of “peaker plant” for data processing may still be an option. Expanding the capacity to handle cloudier conditions can also dump excess power on sunny days back into the local grid or battery units (Tesla or whatever). I could see a cottage industry of light manufacturing using excess power on sunny days and shutting down on cloudy days if the business model works.
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