Region
South Africa

Sector
Call Centres & Business Process Outsourcing (BPO)

Summary:

The BPO sector has been targeted by the government as a key sector for job creation. As a result the Free State Investment Promotion Agency is promoting the province as the perfect destination for investment in this sector.

Contact
Lesley-Anne Welman

Email
lesley@fipa-sa.co.za

Tel
+27 51 410 0885

With the South African government having stated its aim to attract more call centre investment, particularly to areas outside of the traditional cluster of Cape Town, Johannesburg and Durban, the Free State is being touted as an ideal destination.

The government has targeted the Business Process Outsourcing & Off-shoring (BPO&O) sector as a priority for job creation, with a survey last year suggesting that there is between US$90-175-million in foreign direct investment (FDI) that the country as a whole has the potential to attract.

As a result, the Free State is looking to attract a significant portion of BPO&O sector FDI coming into the country. It is envisaged that the sector could create approximately 8,000 (3,000 direct, 5,000 indirect) new jobs in the Free State by 2011.

The Free State Investment Promotion Agency is currently working to attract further BPO investment into the province, and has highlighted key reasons why the Free State is the right choice for potential investors.

Why choose the Free State?

• Rental costs are lower than those of Johannesburg and Cape Town.
• Labour costs are also lower than those in Cape Town and Johannesburg.
• Location provides easy and convenient access to Johannesburg.
• Supporting infrastructure is on a par with both Johannesburg and Cape Town
• Flexible rental policy for under-utilised business premises in some parts of the province
• Language skills in English, Sotho, Tswana and Afrikaans are readily available.
• Neutral English accents
• Availability of young unemployed matriculants and graduates

Resources in the Free State:

• The Free State has already identified a number of potential sites for call centre locations, including industrial parks, unused government and business buildings, as well as vacant land.
• The province also has a well-educated population, which is available to be utilised by any incoming investors.
• The Free State has two universities – University of the Free State and the Central University of Technology – as well as several further education and training (FET) colleges.

The Free State Investment Promotion Agency notes that there are also a significant number of unemployed graduates in the region, and therefore call centre operators are not likely to view skills as a potential constraint.

Target markets:

• Banks
• Insurance
• Cellphone industry
• Medical Aid
• Transcription (Medical, Legal, etc)
• Government Services (Transport, Health, Social Services, Home Affairs, etc)
• Municipality Services (Sewage, Traffic, Water, etc)

Internationally, the Free State Investment Promotion Agency is targeting BPO investment from three continents: North America (time zone - different); Europe (time zone - same); Asia (market saturation).

Incentives for BPO&O investment:

In 2007, Trade & Industry minister Mandisi Mpahlwa launched the Government Assistance and Support Programme (GAS), outlining a number of key incentives to attract foreign BPO investment into South Africa.

The BPO Investment Support Grant is designed to attract BPO&O investment that creates employment opportunities and is offered to local and foreign investors establishing projects that aim primarily to serve offshore clients.

The Training and Skills Support Grant is directed towards the cost of providing company specific training, and is separate from any assistance obtained through the Sector Education and Training Authorities (SETAs).

To find out more information on these incentives, visit the BPO Government and Assistance Support Programme incentive page.

For more information about BPO investment, contact the Free State Investment Promotion Agency:
Name: Lesley-Anne Welman
Tel: +27 51 410 0885
Email: lesley@fipa-sa.co.za

Free State Investment Promotion Agency