Ricky Delgado, president and chief executive officer of IT&E, said the CNMI government stands to benefit from the multiplier effect of expanding the call center industry on Saipan.
“While the call center itself may receive tax incentives, the people who work in the call center will be able to eat out, buy cars, houses, travel, and pay income taxes, all of which will find its way back into the CNMI economy,” said Delgado. “If we are able to hire up to 400 people, in time, that’s 400 people who are not going to be laid off, that’s 400 people who are going to be working for the private sector.”
“We hope that they realize that we are a pioneer asking only that we be placed on equal footing with our competitors in the Philippines and India. We hope that they come to understand that we are part of the CNMI and if we become successful, we could employ up to 400 people who will pay taxes, shop and be assets to the economy rather than trying to share in the ever-shrinking government hand-out pie,” he added.
IT&E is negotiating to get more call center contracts from different U.S.-based companies for the CNMI, including Verizon.
But Delgado said the Philippines and India are highly favored compared to the CNMI because both countries have abundant skilled personnel and offer cheaper labor.
“There are so many in the Philippines and India that are also competing with the same clients. We’re lucky that we already have a relationship with some of them…. But by no means that guarantees us to get the business,” he told the Variety in a phone interview yesterday.
He refused to identify the U.S. companies that could potentially enter contracts for the CNMI’s emerging call center industry due to confidentiality reasons but agreed to name some of them.
“I can’t name names because we’re under a confidentiality agreement but obviously we’ve talked to Verizon, which is our former parent company. Hawaiian Telecoms, which is also part of Verizon. So we’re using old relationships to win this business. We’re also talking about other clients but we can’t mention their names,” the IT&E president said.
There are close to 800 calls centers in the Philippines.
“If you look at the Philippines today, you see buildings constructed all over the place. Look at how full the restaurants and malls are. This is from the one million people working in these kinds of businesses. This is the multiplier effect created when a person who used to earn $100 per month, now earns at least $400,” he said.
In the CNMI, IT&E pays call center workers the federal minimum wage rate.
Delgado said because the CNMI has a very limited labor pool, it obviously cannot compete with the Philippines, but the commonwealth could still get a fair share of the burgeoning global call center industry.
He said all that IT&E is asking are certain tax incentives to make it easier to operate more call centers on Saipan.
“IT&E is asking for these tax incentives to be able to offer attractive prices to potential clients which have options of working with other service providers in the Philippines. In the Philippines, aside from having more abundant labor, cheaper power and a track record of being a call center destination, potential call center investors are given tax incentives comparable to what we have requested,” he said.
He stressed that if IT&E fails to get its requested tax incentives just like in the past, it will be forced to bring its business to Cebu City in central Philippines.
“We don’t have the time. At the end of the day, we have alternatives, Cebu is one of them. If they don’t want to do anything with it, then we’ll just move it to Cebu,” Delgado said.
“I don’t want the CNMI to lose this opportunity. We definitely gave it our best try. We definitely wanted to make it our first choice. We’re investors here [in the CNMI]. We want to contribute to its economy. But if they don’t want to do it, there’s nothing I can do.”
