‘Invest in Davao because…’

by Blogie • 24 April 2007

The Philippine Economic Zone Authority (PEZA) has apparently directed Damosa Land to ‘keep lease rates down’ in order to attract more locators. Damosa I.T. Park director Ed Villaver revealed this interesting fact during this month’s Techno Kapehan. He said this was to be his company’s counterpart to the incentives PEZA will provide investors. It’s rather strange that, instead of ensuring that Damosa Land commit to export zone standards, PEZA chooses to dish out such platitudes.

Besides, isn’t it rather defeatist? I mean, isn’t it already a given that land / rental rates in Davao are lower than in other metropolitan areas? So bringing it down even more might make it unprofitable for the developers. If I.T. parks are forced to pimp their wares, might that not result in poor services, inadequate facilities? Already Damosa Land’s I.T. park project seems to be showing signs of difficulty in coping with the exacting demands of I.T. locators.

Therefore, Damosa Land should instead be encouraged to pay more attention to their planned infrastructure and their current services. For example, I believe they would do well to invest in a world-class marketing & PR department, for one. This — plus other improvements — will certainly mean added costs, and could necessarily translate to higher lease rates for their locators. But if it means they will be able to deliver excellent services and facilities, I think it would result in a win-win situation.

Speaking of low rates, I find it irresponsible a recent remark that was made with regards the salaries of call center agents. Andre Fournier, a Davao City Chamber of Commerce trustee, last week issued a statement to the effect that, in order to bring in more I.T. investments, especially contact center companies, Dabawenyos shouldn’t clamor for higher wages. It should be noted that call center agents in Davao are relatively one of the lowest paid in the country.

For example, Link2Support. Its management naturally won’t divulge such information, but several of their employees have told me that they’re getting just over P7,000 per month. Even if it were P8,000 I think it would still be way below how much they should be receiving. According to Link2Support’s operations manager, Gary Dumael, their call center representatives are expected to be equipped with thorough technical knowledge. So, aside from high English proficiency, they must also possess at least above-average computer literacy. And they’re getting paid only that much?

When we in Davao’s I.T. industry go out and attract investments, the goal in mind should be sound economic development. I’m not saying that we try to milk investors dry. My point is, we should focus on hooking up with high-value investments that will have a positively huge impact on the local economy. And to accomplish this, we ourselves must know our value. Instead of saying “Come here, we’re cheap,” it would be so much better to declare “Invest in Davao, because we’re awesome!“

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Comments%27Invest+in+Davao+because...%272007-04-23+16%3A29%3A38Blogie on '‘Invest in Davao because…’'

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Dominique said,
{24 April 2007, 3:34 pm }
Hi, Blogs: good points here and in your previous entry. Two points I’d like to make:

1) Davao should concentrate on its people and skills profile rather than on the infrastructure. Infrastructure is great, but it can be built in fairly short order. Skills, on the other hand, take a bit longer.

2) Davao needs to address security perceptions. This is one of its biggest stumbling blocks — the fact that it is in Mindano and therefore “close” to all the trouble in Basilan.

By the way, can you have a look at my davaoblogs account? I registered, but I didn’t get the confirmation email.
Blogie said,
{24 April 2007, 4:58 pm }
i agree with you wholeheartedly, dom!
(your davaoblogs.com acct is now OK)
Mark said,
{24 April 2007, 9:55 pm }
To refine Dominique’s first point, I would like to add that we have to be careful about how we go about improving the skills of our people. Let’s not limit the activity by building skills on our own (that is, where Davao is operating in a vacuum). Michael Porter’s competitive clusters theory is still good these days, but we have to remember that his theory was presented in the 90s and many refinements have been added on to it since. Specifically in the area of knowledge acquisition. We need to realize that tacit knowledge in ICT (both the technical and the business aspects of it) is already present and abundant outside of Davao City. We should also be thinking about how to access, use, and improve upon that pre-existing external knowledge so that we hit the ground running. One way to go about it is to form relationships (academic, business, formal, informal, etc.) with people outside the city. Anything that links people in Davao to people outside Davao is a potential channel that we can use to funnel knowledge and skills inwards.