World Bank Says Wider AI Adoption and Higher-Value BPO Could Lift Philippine Productivity

The Philippines could get far more out of the artificial intelligence boom if more businesses adopted the technology and the outsourcing industry moved into higher-value work, World Bank economists told BusinessWorld in an interview published on October 12. Franziska Ohnsorge, the bank’s chief economist for Asia, said the country already benefits from demand for AI-related goods, sitting roughly midway in the region on the share of AI-enabled goods in GDP, a trend reflected in an upgrade to the bank’s export forecast.

The bigger prize, she said, is adapting AI to local conditions and helping the roughly 80% of firms not yet using it find productive uses. A World Bank survey found only 12% of Thai firms and 23% of Indian firms had adopted or were adopting AI, against 43% in the United States, and that about 70% of Thai firms and 80% of Indian firms expect no productivity gains from it. Cost is the clearest barrier across emerging markets, Ohnsorge said, noting that cheaper models only arrived a year to a year and a half ago. Governments can help by clarifying rules on data privacy and security.

Jaffar Al-Rikabi, the bank’s senior country economist for the Philippines, said IT and business services make up about 27% of exports and employ around 1.4 million people, and have cushioned the economy from weaker public investment and higher energy prices. He sees room to move business process outsourcing toward data analytics, financial and legal services, health process management, complex customer support and AI-assisted back-office work.

What it means in practice

For BPO employers, the message is to use AI to upgrade existing jobs, building on a strength the country already has. The bank also flagged a downside. If global AI investment slows or unwinds, Ohnsorge warned, economies tied into AI supply chains would feel it through finance and trade, as stock market losses spill into capital flows and demand for electronics exports weakens. She described that as a risk rather than the bank’s baseline.

The comments echo Balisacan’s call for AI reskilling alongside infrastructure upgrades and industry warnings that Philippine BPO needs agentic AI platforms by 2027. What to watch: whether new government incentives target AI adoption by smaller firms, and how BPO hiring shifts toward analytics and specialised services.