PHL a top climber in trade facilitation rankings

The Philippines was among the “lead reformers” in the Asia-Pacific region on trade facilitation, the Organization for Economic Cooperation and Development (OECD) said in a report.

Trade facilitation refers to measures that streamline and simplify technical and legal procedures for products at the border.

According to the OECD’s 2025 Trade Facilitation Indicators, the Philippines scored 14.97 across 11 indicators, putting it among the “leading reformers” like Laos, Kiribati, Cambodia, Maldives, Tonga, Vanuatu, Thailand, Indonesia, Myanmar and Vietnam.

The “lead reformers” refer to countries that had the highest percentage change between their average trade facilitation performance in 2022-2024 from 2020-2022.

The Philippines ranked 15th out of 33 Asia-Pacific countries.

“Being one of the fastest nations to adopt positive reforms on trade facilitation is a welcome sign that the country is catching up with its neighboring countries,” Oikonomia Advisory and Research, Inc. economist Reinielle Matt M. Erece said.

However, Mr. Erece emphasized that the Philippines must cut red tape and embrace digital integration to sustain its progress.

“Improvements in these areas will ensure faster trade activity while improving security and transparency on the borders,” he added.

The leading performers in the region in 2024 were Hong Kong, Japan, Singapore, South Korea, Australia; New Zealand, China, Malaysia, Thailand, and India, the OECD said.

Overall, South Korea was the best performer in the Asia-Pacific region with a 20.83 score, while the Federal States of Micronesia was last with a 3.41 score.

The OECD said nearly one in two economies in the Asia-Pacific improved their performance in areas of domestic border agency co-operation and information availability.

“The report shows that border bottlenecks and red tape, as measured by the OECD, were reduced on average by 3%-7% since 2022 across the 163 countries and regions covered,” it said.

The OECD also added that this resulted in trade facilitation reforms that reduced trade costs by up to 5% over the last decade.

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Source: Business World

Investor sentiment likely to improve as Philippines is removed from ‘gray list’

The Philippines’ exit from the Financial Action Task Force’s (FATF) “gray list” is seen to improve investor sentiment, but analysts noted that continued reforms are necessary to sustain progress.

The FATF on Friday removed the Philippines from its list of jurisdictions under increased monitoring for “dirty money” following a “successful” on-site visit.

BSP Governor Eli M. Remolona, Jr. said in a text message that the Philippines’ removal from the FATF’s gray list will “help our overseas Filipino workers (OFWs) and foster more investment in our economy.”

“It also complements our ongoing efforts to make the financial system a stronger driver of sustainable growth,” he added.

Mr. Remolona attended the FATF Plenary and Working Group Meetings that took place in Paris, France from Feb. 17 to Feb. 21.

“Indeed, the Philippines came out of our gray list. They showed our members that they have completed in full the action plan,” FATF President Elisa de Anda Madrazo said at a press conference late on Friday.

The Philippines was on the FATF’s gray list for over three years or since June 2021.

The dirty money watchdog noted the Philippines’ “positive progress in addressing the strategic anti-money laundering and countering the financing of terrorism and proliferation financing (AML/CFT/CPF) deficiencies previously identified during their mutual evaluations.”

“The Philippines has completed their Action Plan to resolve the identified strategic deficiencies within agreed timeframes and will no longer be subject to the FATF’s increased monitoring process,” it said.

Finance Secretary Ralph G. Recto said in a statement that the removal of the Philippines from the gray list is a “seal of good housekeeping that strengthens public confidence in our financial system.”

“By upholding the highest standards of financial governance, we will attract more foreign direct investments and expand more trade partnerships that will help accelerate economic growth,” he said.

This would also support the government’s push to achieve an A-credit rating, Mr. Recto added.

The Anti-Money Laundering Council (AMLC) said the exit from the gray list will “facilitate faster and lower-cost cross-border transactions, reduce compliance barriers, and enhance financial transparency.”

Being part of the gray list for the past years has been a “burdensome process for banks and other financial institutions,” AMLC said.

“This process discourages correspondent banking relationships and international financial flows into the country. The exit will reduce international fund transfer requirements, benefiting Filipino individuals and businesses.”

The AMLC also said that the gray list status had hindered other countries from doing business with the Philippines.

“Moreover, even prior to the gray-listing, some foreign regulators were already imposing stringent requirements or fines on financial institutions dealing with entities in the Philippines and other countries deemed to have weak anti-dirty money regimes.”

“This prompted some banks to just avoid doing business with entities in those countries rather than managing possible money laundering or terrorist financing risks. The FATF decision may prompt foreign banks to review and resume their business relationship and transactions with Philippine financial entities.”

President Ferdinand R. Marcos, Jr. last year directed all concerned agencies to work on efforts to exit the list by October.

In July, Malacañang issued an executive order mandating all government offices to adopt the National Anti-Money Laundering, Counter-Terrorism Financing, and Counter-Proliferation Financing Strategy 2023-2027.

“With our exit from the FATF gray list, we are optimistic that the international community will see the Philippines as an even more attractive destination for business and investment,” Securities and Exchange Commission (SEC) Chairperson Emilio B. Aquino said.

Chester B. Cabalza, founding president of Manila-based International Development and Security Cooperation, said that this is a “celebratory moment” for the country.

“As an aspiring upper middle-income country, such transformation will give it more credibility as an investment destination in the region without fear that our financial buoyancy comes from dirty money,” he said.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said this would increase investor confidence in the Philippines.

“The Philippines would save more processing time and also save on transaction costs, a more desirable scenario if transactions of the country with the rest of the world move with greater ease,” he added.

FATF’s Ms. Madrazo had also noted the Philippines’ efforts “in combating the risk of dirty money running through the casinos.”

The Philippine Amusement and Gaming Corp. (PAGCOR) said it will continue to strengthen regulations and strictly monitor the local gaming industry.

“We also commit to sustain the fight against money laundering and terrorist financing in the entire Philippine gaming industry, including our online gaming operators, land-based casinos and junket operators,” PAGCOR Chairman and Chief Executive Officer Alejandro H. Tengco said.

MOVING FORWARD

However, the FATF said it will be crucial for the Philippines to sustain the measures on strengthening AML/CFT regimes.

“The FATF encourages the Philippines to continue its work in ensuring that its CFT measures are appropriately applied, particularly the identification and prosecution of TF cases, and are neither discouraging nor disrupting legitimate nonprofit organization activity,” it said.

Ms. Madrazo also said the Philippines will face a new assessment in 2027.

“That will be an opportunity for the FATF to verify that the measures are sustained and still in place,” she added.

For its part, the AMLC said that it is committed to “ensuring long-term compliance with international standards.”

Bienvenido S. Oplas, Jr., president of a research consultancy and of the Minimal Government Thinkers think tank, said the Philippines should continue to clamp down on illegal trade, which is a channel for dirty money.

“Illicit trade in tobacco, oil, jewelries, etc., this is a big source of money laundering. The government should crack them down,” he said.

Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said the government must accompany reforms with other measures to better attract investments.

“While exiting the FATF gray list removes a major barrier to investments, the Philippines must compete on its strengths, such as its young workforce, service-driven economy, and tourism potential,” he said.

“Regional competitors are also aggressively courting investors, so policy consistency, infrastructure upgrades, and targeted investment promotions will be critical,” he added.

SAFEGUARDS SOUGHT

Meanwhile, Jose Enrique “Sonny” A. Africa, executive director at think tank IBON Foundation, said there needs to be “stronger safeguards to mitigate the heightened risk of continued erosion of civic and democratic space.”

“The FATF itself nominally calls for a targeted risk-based approach — the government should be challenged to uphold the spirit of this with transparent data-driven risk assessments and with sanctions governed by due process with clear judicial oversight,” Mr. Africa said.

The FATF in its statement said that the Philippines’ continued measures should not impede on legitimate nonprofit activities.

“Executive misapplication has already been checked with so-called terrorist financing cases motu proprio dismissed for insufficiency of evidence and no probable cause at least thrice by the courts,” Mr. Africa said.

He said that the government should “stop using AML/CFT as political tools to suppress activism and use them against actual financial crimes.”

“It should stop freezing assets of NGOs and individual activists with trumped-up terrorism financing accusations and redirect enforcement towards systemic financial crimes including those committed by politically connected individuals.”

In 2002, the FATF blacklisted the Philippines for having no legal anti-money laundering framework. It was removed from the blacklist a year later after the passage of the Anti-Money Laundering Act.

Source: Business World

Can the Philippines keep its title as contact center capital of the world?

The Philippines continues to be the global leader in the contact center industry, and if the country wants to retain this position for the next 10 years, urgently modernizing processes with the use of generative artificial intelligence (AI) and data is key.

According to IDC, generative AI spending in the Asia-Pacific (APAC) region alone is projected to reach $26 billion by 2027. This includes AI investments in customer engagement as businesses seek to remodel their operations around creating delightful customer experiences at every touchpoint.

In the Philippines, a 2024 IT & Business Process Association of the Philippines (IBPAP) survey reported that 67% of IT and business process management (IT-BPM) firms, the sector that includes contact center companies, are already leveraging AI in their operations, focusing on customer service, data entry, and quality assurance.

However, while AI use cases in customer experience are increasing, traditional contact centers still struggle to meet the evolving expectations for personalized, omnichannel interactions. Amid shifting customer demands, contact centers need to transcend inefficient legacy systems and overcome integration challenges to gain a competitive edge in the age of AI.

By embracing advanced technologies and improving system interoperability, they can better cater to modern customers and enhance overall service quality.

THE STRATEGIC BENEFITS OF MODERNIZING

Utilizing real-time customer data and advanced language models can address operational inefficiencies in contact centers and improve agent experiences. Modernizing contact centers through cloud-native architecture can facilitate the delivery of better customer service at a lower cost and help businesses transition from outdated systems to more advanced ones.

With 43% of APAC consumers expecting a response within an hour, according to Twilio’s 2024 Consumer Preferences Report, streamlined processes and unified customer data can lead to faster responses and solutions. Customers do not have to go through the hassle of repeating their problems or waiting on operators to locate their information.

Insights drawn from unified data, including customer history, conversational insights, preferences, and AI-derived traits such as sentiment, predicted lifetime value (LTV), and churn propensity, can also create highly contextualized and personalized interactions, which can keep customers happier and translate to greater loyalty and customer LTV for the business.

Businesses and agents also stand to gain. Reduced instances of app switching, better access to recommended responses, and automated wrap-up reports can enhance overall productivity. This approach addresses issues such as long waiting times, repeat calls, and high transfer rates, ultimately leading to service and operational performance improvements. Businesses can streamline operations further using predictive analytics, which reduces workload and search time for agents.

THE NEXT RACE: EMBEDDING CDP DATA INTO THE CONTACT CENTER TO EMPOWER AGENTS

Harnessing the potential of first-party data, which is customer data directly collected and owned by the organization doing business with them, and empowering agents is essential for modernizing contact centers. Collecting first-party data from various sources and integrating it into real-time service interactions can provide agents with more comprehensive information than traditional customer relationship management (CRM) systems. Using a customer data platform (CDP) alongside CRM can help contact centers better understand customer behaviors.

Leaders in customer experience can rely on CDP data because it offers real-time insights and supports the shift towards omnichannel. The real-time nature of CDP data allows leaders to respond swiftly to customer needs and preferences as they arise.

CDPs’ ability to consolidate data from billing systems, data warehouses, and marketing automation platforms also makes it easier to transition across channels without losing context or information.

With the emergence of newer large language models and the memory capabilities of CDPs, agents now have access to personalized assistance during customer conversations. This development changes the traditional approach to agent training.

Lengthy training sessions confined to a classroom setting, which also incur additional costs, are less necessary. Instead, agents can engage with customers more proactively, knowing that their AI assistant can help with complex scenarios that may arise occasionally.

NAVIGATING TRANSFORMATION AMIDST FILIPINO CONSUMERS’ PRIVACY EXPECTATIONS

As with every new technology, businesses need to be mindful of using AI safely to harness customer data and build transparent and trustworthy systems. According to Twilio’s recent State of Customer Engagement Report, 41% of businesses in the Philippines consider protecting customer data their most pressing challenge. Shortage of labor and navigating the complexity of regulations were also identified as top challenges.

Incorporating privacy and security features and principles into the development lifecycle of new technologies can support the compliant and responsible use of customer data. The report also found that the majority (77%) would trust a brand more if it disclosed how customer data is used in AI-driven interactions. Additionally, three in four Filipino consumers ranked transparent communications such as clear terms and conditions, return policies, ease of reaching customer support, and responsive customer service, as the most effective ways to maintain trust.

As customer expectations and business needs evolve, traditional contact centers must also keep up with the times. Improving customer experience requires adopting modern technologies that ensure data protection, improved response times, and transparency.

This shift involves moving away from outdated models and implementing scalable solutions that can meet business needs. Modern contact centers should be capable of rapidly adapting to changes and providing excellent customer service.

Source: Business World