The depreciation of the Rand over the past two years against the USD has led to significant growth in the South African tourism, wine and BPO industries. The tourism industry has seen 7% growth, while the local wine industry progressed to the seventh-largest wine producer globally. The BPO industry enjoys added benefits as well due to a favourable time-zone and cultural similarities with the US and Europe.
A weaker currency has always favoured the outsourcing industry as this makes outsourced services cheaper for the buyer as they enjoy higher return on investment (ROI). Conversely, a stronger currency negatively impacts tourism and mining, and in addition to this makes hiring more costly compelling companies to look to other locations with weaker currencies for outsourced services.
India and the Philippians are amongst the locations with steady lower currencies and have established outsourcing hubs in their respective countries. South has as much of a compelling value proposition for these hubs in addition to time-zone and culture, such as the large pool of English speaking talent. The South African talent pool also boasts Spanish, Portuguese and French-speaking capabilities.
BPESA along with the SA government are working tirelessly towards establishing outsourcing as a key driver for job creation, with the government having come up with a number of initiative geared towards promoting outsourcing.
For more information on South Africa’s compelling positioning around outsourcing, download our report on Rand depreciation a boon for South African outsourcing industry.