Business outsourcing incentives to expand
SA is competing with countries such as India and the Philippines in this market. The industry has already created about 210,000 jobs nationally.
A 2012/13 Business Outsourcing report showed that the Western Cape was second to Gauteng for the number of call centre and business process outsourcing jobs. However, the Western Cape had the highest number of international companies locating their offshore outsourcing jobs in Cape Town.
"Gauteng's jobs are mainly aimed at servicing the local market while the Western Cape is dealing with the international markets," Business Process Outsourcing SA: Western Cape chief executive Gareth Pritchard said.
The report stated the financial services sector makes up the highest proportion of customer service associates (those who operate call centres) at 41.2%.
International clients from UK, Australia
The report said this was different from other international outsourcing markets where the financial sector made up about 16.5% of their call centre jobs. The UK market makes up about 61% of the Western Cape outsourcing market with Australia making up about 9%.
Timol is attending the Business Process Outsourcing conference in the Western Cape.
"Those incentives have proved to be the real sweetener to attract foreign direct investment. However, other factors such as the 85% reduction in telecommunications rates, have also helped," he said.
Timol said he expected the final announcement on the incentives, which were originally introduced in 2009, to be made in the first quarter of next year.
Pritchard said there were no final numbers on the success of the incentives. He said that if one calculated the 3,000 jobs created in the past year with the average incentive, the return on investment for the Department of Trade and Industry on a payout of about R300m was about R2.5bn in foreign investment into the Western Cape.
"That incentive has proved to be a real boon for companies, especially in the first three years of their operations," he said.
Pritchard said there had always been an expectation that an outsourcing operation would have a three-year life span, but that the incentives have probably extended that to about five years or more.
Source: Business Day via I-Net Bridge
Source: I-Net Bridge
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