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| Friday, December 17, 2010 | |
| Buenos Aires, Argentina: The Frugal Man's Outsourcing Paradise | |
| Buenos Aires, a recognized player on the global BPO scene, continues to be a frugal mans paradise. This destination is growing at double-digit rates in terms of both volume and value of the electronic commerce and payment business. | |
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Buenos Aires is the capital of Argentina. One of the largest cities in South America, it is the financial, industrial, commercial and cultural center. Also one of the world’s leading ports, it lies on the Parana River, near where the river enters the Atlantic Ocean. Buenos Aires is the second-largest metropolitan area in South America, after São Paulo. The city's service sector is diversified and well-developed by international standards and accounts for 76 percent of its economy (compared to 59 percent for all of Argentina's). With 14.4 million inhabitants, it has 38 percent of the nation’s population and 35 percent of the country’s economic activity. In the city, the workforce numbers about 1.4 million people, with about 36 percent involved in services, 18 percent in trade, 17 percent in manufacturing and about 12 percent in finance, insurance, and real estate. Buenos Aires, a recognized player on the global BPO scene, continues to be a frugal man’s paradise. This destination is growing at double-digit rates in terms of both volume and value of the electronic commerce and payment business. Currently, it is ranked 269 overall, most expensive place in the world for expatriates to live, out of 300 international locations. However, electricity is 30–60 percent less expensive than United States - the average cost for power is US$0.04 per kilowatt per hour. Property is affordable; the median sale price per square meter of office space is around $65 per square foot. Buenos Aires has a large talent pool and a number of reputed educational institutions, capable of supplying workforce to the IT–BPO industry. Argentina’s cultural closeness and linguistic similarity with Europe is an added advantage, as it allows the country to additionally tap business from markets in Europe. Spanish is the official language, but Portuguese and English are also spoken in the city, which provides multi-lingual services. English language skills of the population are becoming stronger, as education in English is being encouraged. The city has low attrition rates. As regards office space, Buenos Aires posseses Class A office space. However, vacancy rates are on the decline because of high demand leading to rising sales and lease rates. The city can serve US markets effectively as Argentina lies in the same time-zone as the East Unite States. When speed of response and deadlines become an issue in projects, working with people in a similar time zone becomes a crucial component to a smooth and effective work process. This city's time zone offers the added advantage- it is one hour ahead of Eastern Standard Time (EST-USA), 4-5 hours ahead of Pacific Standard Time (PST-USA), and 3 hours behind Greenwich Mean Time (GMT-UK). The IT–BPO industry (high-tech sector in general) is growing rapidly and has been prioritized and encouraged through incentives by government. The Software Law establishes that software production is to be considered as a productive transformation activity and accorded the same priority and incentives as other industrial activities. Buenos Aires, one of the main markets in Latin America and in the world, is the ninth most populated urban conglomerates in the world. It is the 13th urban center with the largest income in dollars in the world, ahead of cities like Hong Kong, Miami or Sao Paulo, and its growth prospects are excellent. Unlike much of the rest of the country, this city has a varied economy, which helps it maintain a degree of stability, despite the rampant inflation that has often burdened the entire country. This region maintains low debt levels and debt service requires less than 3 percent of the total budget. Known as the Paris of South-America, its GDP (Gross Geographic Product) almost triples the average income per capita in Argentina. This complex, energetic, and seductive port city, which stretches south-to-north along the Rio de la Plata, has been the gateway to Argentina for centuries. The brain drain following the country’s economic crisis is seeing some reversal with growth settings in, and this could be a potential source of talent for the IT–BPO industry in the city. The growth of Argentina’s IT-BPO industry during recession was adversely affected. However, in the last few years, a large number of multinational companies have set up their operations in Buenos Aires. This industry has been growing rapidly since then, making it one of the fastest growing sectors in the economy. The prominent services sourced from Buenos Aires include software development, call center, back-office operations (such as data processing) and creative services (such as design and media services). Buenos Aires has seen a lot of movement and change due to the arrival of multinational companies establishing their regional hubs and offices in the city. Global giants with the likes of Google and MCI have set up shop in this region. |
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