The United States is planning measures to curb the call centre and outsourcing industry, prompting the Philippines and India to prepare for a diplomatic and economic confrontation.
The proposed restrictions target a sector that has become a cornerstone of employment and export revenue for both nations, with the Philippines operating one of the world's largest business process outsourcing industries.
Industry executives in Manila are expressing concern over the potential impact on the sector's future.
The move signals a shift in US trade policy towards protecting domestic service jobs, potentially reversing years of offshoring trends.
For investors, the development introduces new regulatory risk to emerging market equities and currencies tied to service exports.
The Philippines and India are expected to push back against the measures, arguing that the outsourcing industry provides cost efficiencies for US companies and high-quality services.