Diversity Spectrum CEO Thomas Duckenfield will present to government leaders, business leaders, and journalists in China and the Philippines innovative ideas about microfinance and offshoring opportunities in Asia.

Microfinance

With regard to microfinance, he will discuss the nature, importance and types of innovations that help reduce microfinance transaction costs and risks, as well as make it possible for poor households to satisfy their investment and consumption smoothing requirements.

Microfinance in China and Southeast Asia is poised for a significant expansion as governments, Non-governmental Organizations (NGOs) and commercial banks begin to explore ways to provide the most impoverished people -- especially women, ethnic minorities, and indigenous peoples -- with greater access to credit.

Microcredit has a long history in Asia, dating back to 1976 when the Grameen Bank in Bangladesh began providing small loans primarily to women in small groups, a segment of society too poor to qualify for credit from the banks. It started in China in the mid-1990s, when the United Nations Development Program (UNDP) and the World Bank began promoting the concept in cooperation with Chinese organizations.

Microfinance may include several types of financial services, including deposit taking and insurance, while microcredit normally refers to small loans of between $125-$375. The terms are often used interchangeably in the media.

Many are hoping that microfinance can give a boost to rural China and Souteast Asia, which today face enormous problems. Some 30 million "relatively" poor people survive on less than one dollar a day, and another 30 million people live in "absolute poverty" of less than 25 cents a day. The vast majority of these are in the countryside, where there is a huge gap in living conditions and public services, such as medical care and education, compared to urban areas.

Offshoring

With regard to Offshoring, China, India, and The Philippines have emerged as strong players in the rapidly evolving offshoring industry, competing successfully with other low-wage destinations in creating value.

In the case of the Philippines, offshoring accounts for the export of more than $1.5 billion worth of services. Today it employs around 100,000 people in call centers, and the country is beginning to attract work in shared services, data entry/medical transcription, and animation.

Overall, the Philippines aims to win 5 percent of worldwide global business process revenues by 2010, creating an industry worth as much as $10 billion.

Yet, for all its potential, the Philippines faces enormous challenges in achieving this goal. Research shows that, although it boasts widespread English language skills, low costs, and promising human resource capabilities, the Philippines lags behind India and many other potential offshoring locations on several of the key criteria companies examine when choosing an offshoring location, such as: risk, infrastructure, the availability of vendors, and a paucity of skilled middle managers.

If the Philippines is to capitalize on the opportunities that are undoubtedly there for the taking, the government, together with the private sector, must work to strengthen the perceived attractiveness and reality of offshoring to the Philippines.  

Key areas for action include: developing a clearer market strategy to sell its strengths, tackling infrastructure weaknesses, enhancing the suitable labor supply, attracting more flagship clients, establishing an industry association, and avoiding granting incentives.

Dates: April 23 - May 3, 2009

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