Business process outsourcing slow for Mauritius

Business process outsourcing (BPO) is often mentioned by policy makers as a possible money maker for African countries with low labor costs and multicultural, multilingual workforces. But returns on investments in BPO are not coming quickly for the island nation of Mauritius.

In 2003 Mauritius fashioned a policy to build a “fifth pillar” for its economy by making investments meant to transform the country into a knowledge-based, high-tech cyber island. Traditionally the country has relied on the manufacturing, agricultural, tourism and financial-services sectors to support its economy. But with trade liberalization, the country has had to look elsewhere for growth.

Three years later, one measure of the country’s progress — or lack of it — was marked by its failure to register on U.K. research company Datamonitor PLC’s list of emerging BPO destinations on the African continent.

Datamonitor reports that countries leading Africa’s call center growth through 2010 include Morroco, Tunisia, Egypt, Botswana, South Africa, Ghana and Kenya.

In 2003, Mauritius was optimistic. At an IT conference in April that year, Deelchand Jeeha, the country’s minister of information technology and telecommunications, said, “Mauritius can also play a small role in the [ITE] market and very humbly target [US]$1 billion of [IT] revenue by 2008 …. with a job creation potential of 20,000 in the sector. This is why we are investing in cybertowers and business parks.”

In addition to investing in cybertowers and business parks, Mauritius intended to ride on its bilingual, English and French-speaking workforce, stability and robust intercontinental telecommunications links.

Even though 23 operators flocked to the nation’s showcase “cybertower,” business has not followed suit.

“Mauritius has not registered on our radar,” said Peter Ryan, an analyst with Datamonitor. Though the island has excellent opportunities in terms of labor, language and infrastructure, it has been restricted by its limited scalability, compared to South Africa, which is in the same region, Ryan said.

Historically, the country is known for tourism, rather than its call center business. Mauritius is also competing with Kenya, in addition to South Africa, for the same market, Ryan said.

And although it is bilingual, the island nation competes with other destinations such as Morocco and Tunisia, which have better language quality in French, Ryan said.

In spite of the setbacks, Mauritius still has options. According to Ryan, it could convert its understanding of Western business through its experience with tourism, to target high-value niches in the BPO market, instead attempting to build the type of broad BPO business that would support the 500 to 1,000 call centers. Such niches include transaction and insurance processing, credit underwriting and advanced accounting.

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Jim Love, Chief Content Officer, IT World Canada

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