They say the problems in the U.S. and the possibility of recession could be a bonus as more companies based there attempt to save money by outsourcing their operations to the Philippines.

Call centers and back-office operations, such as accounting and financial processes, medical and legal transcription, engineering services and software writing, is one of the fastest growing businesses in the Philippines.

The Business Process Association of the Philippines (BPAP) expects the sector to be posting revenues of US$13 billion and employ more than one million people by 2010.

Last year the industry posted revenues of US$4.875 billion, up nearly 50 percent from the previous year, while employment rose 27 percent to 300,000.

BPAP president Oscar Sanez told AFP the 2010 target was feasible saying the industry has been growing by more than 40 percent annually in the past three years.

"If there is a recession in the U.S., you will see companies trying to cut costs with more outsourcing," Trade and Industry Secretary Peter Favila told AFP.

Julian Ramos Garcia, president of E Scribir Inc., a provider of various outsourcing services said that "with a recession looming in the U.S., we are getting a lot more calls because people want to cut their costs."

"We are seeing the tip of the iceberg. There are many more services which are being outsourced to the Philippines," said BPAP's Sanez.

Francis Ong, managing director of software giant Oracle, says his company has been in the Philippines for 18 years and now has its tax and global utilities unit based in this country.

While the Philippines does not pretend to be a serious challenger to outsourcing world leader India, it still sees room to grow due to its English-speaking and educated workforce.

In the Philippines, about half of the outsourcing industry consists of call centers, where agents mainly make and receive telephone calls, but the country is rapidly moving up to more complex services such as medical transcriptions and engineering services.