Soon after the opening of the PhilNITS branch in Davao City, there has been positive movement within the Japanese I.T. community in the Philippines. Where before they have only paid lip service to initiatives in promoting Davao I.T. to the Japanese market, now these entities (private and government) are in fact looking towards the South as a viable investment and outsourcing destination. But more so, as a source of I.T. manpower.

PhilNITS is engaged in the development of high-tech skills. Japan is in dire need of highly-skilled skilled personnel. Hence the bullish outlook of Davao City as an I.T. center by Japanese companies and government agenices. But we must not be overly optimistic.

This renewed industrial interest in Davao City (dormant ever since the heyday of abaca plantations) is not necessarily driven by the presence of a robust I.T. industry here. It is fueled rather by Japan’s own requirements. According to the Japan External Trade Organization (JETRO), their country is in need of 150,000 I.T. engineers annually. The inability to address this has finally allowed Asian countries with strong I.T. industries to receive offshore projects from Japan, especially China, India and Vietnam. It was published in a report that the Philippines receives less than half of what Vietnam gets in terms of outsourced projects for software development and animation.

Hopefully this will change. Metro Manila and Cebu technology providers have already started to gain more ground towards where Vietnam is now. Davao I.T. companies have yet to get a first engagement. But with the growing interest in the city, soon we just might realize a first and a quick second, third and so on. That is, if we can sustain this growth and development that the Japanese see in us.

Recently, SpiceWorx, a Makati-based consulting firm, visited Davao officially for the first time. Each year, SpiceWorx is retained by JETRO to accomplish research into the Philippine I.T. industry on their behalf. Beginning next year, SpiceWorx’s annual report will include Davao City. This report is written in both English and Japanese, thus it has tremendous reach and influence.

It’s safe to assume that Davao’s I.T. industry will very soon witness an influx of inquiries and feelers from Japan. Hopefully, it won’t be all about manpower supply. In order for our industry to experience sustained growth, we need high-value investments to come in: the establishment of foreign-funded software development houses, for one, and the entry of outsourced projects.

But there are still a number of issues that might hinder our ability to successfully synergize with our Japanese counterparts, as well as penetrate the Japanese market. Foremost of this is the availability of I.T. manpower, both present and future. Do we have enough now? Are we going to have a sustained supply of software programmers, graphics designers, animators, systems engineers, etc. in the coming years?

I’ll be discussing the other industry issues in succeeding posts. In the meantime, what are your thoughts on this? Is Davao prepared to accommodate Japan’s burgeoning I.T. requirements?