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FDI and Offshoring within the ICT Sector

FDI and Offshoring within the ICT Sector. Mustafa Çağan November 2005. Service Economy. Services have steadily increased their share of global GDP. Source: World Development Report 2000/2001. And service economy has no boundary!.

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FDI and Offshoring within the ICT Sector

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  1. FDI and Offshoring within the ICT Sector Mustafa Çağan November 2005

  2. Service Economy Services have steadily increased their share of global GDP. Source: World Development Report 2000/2001 And service economy has no boundary!... • If you lose your luggage on British Airways, the techies who track it down are here in India.  If your Dell computer has a problem, the techie who walks you through it is in Bangalore, India's Silicon Valley.  Ernst & Young may be doing your company's tax returns here with Indian accountants. The brain chip for every Nokia cell phone is designed in Bangalore.  Renting a car from Avis online?  It's managed here.

  3. Russia : • High-End Software Eng. Country Specialization Examples by Niche • Ireland : • Packaged Applications • Localization • Product Development • China : • Embedded Software • Hardware Services • Localization • Application Development • Canada : • Application Development • BPO • Contact Centers • Israel : • High-End Software • Learning Systems • Philippines : • BPO • Contact Centers • Animation • Application Development • India : • Application Outsourcing • ITO • BPO • Product Development • Contact Centers

  4. A Real Success Story: Philippines • Consists of 7,108 islands off the southeast coast of the Asian mainland • Location is strategic “Situated on the crossroads of Asia’s commerce and transportation, it plays a significant role in international affairs. It serves as a bastion of democracy and a convenient and vital link between the two worlds – the East and the West.” Doing Business in the Philippines” by Price Waterhouse “ICT will be our leading sector for economic growth… We expect ICT to be the key tofinding our proper niche in the global village in the 21st century.” -President Gloria Macapagal-Arroyo 2000

  5. In 2004 they reached export volume of 1.4 B USD in IT Services 268 M USD* 483 M USD* 40 M USD* Examples of Global References Source: Outsource Philippines, CEO forum 2004 (Figures are 2004 Estimates)

  6. Philippines: Levers of the Success Story Philippine Economic Export Zone (PEZA): Free Trade zones for IT Services Export 1 • Philippine Export-Import Credit Agency (PhilEXIM) • Loan guarantee • Export Credit Insurance 2 3 Technical Education and Skills Development Authority (TESDA)

  7. What about Turkey? • Strategy: Missing long term strategy and also ownership in the Government about ICT • Regulations: Insufficient regulations and incentive mechanism • Technopolice: Limited contribution to the service export • Education: Current education system does not match the need in the market 50 M USD IT Services’ Export %17,6 young population unemployment rate (Source: DIE 2005)

  8. If we don’t, someone will do!

  9. Back Up

  10. %60 Electronic Equipment and Parts...

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