Outsourcing is set to create many job opportunities in South Africa over the next few years, but for this to materialise the government should help set up a public private partnership (PPP) outsourcing company, eQuals Group specialised business director Stuart Herd said in a statement on Tuesday.
Herd expects the government to lend a helping hand by providing seed capital and setting up a PPP outsourcing company to push for the growing number of overseas outsourcing contracts that are fast becoming available.
eQuals handles outsourcing work, including administration and call centres, for companies in Germany, the United Kingdom and Australia.
“The problem is that although outsourcing can provide hundreds of thousands with work, getting into this market is capital-intensive. Most local companies will not have the finances to look for, and win, export outsourcing deals — and this is where significant employment opportunities are for South Africa,” Herd said.
According to Herd, the government should provide seed capital and select three to five outsourcing specialists to partner with it in a PPP venture.
The outsourcing company could also handle outsourcing work for government departments, including call centres and other functions. After a certain period the outsourcing company could then be fully privatised.
“Hopefully — and it is very likely — a large number of ongoing contracts would have been built up in this time, and jobs would have been provided,” Herd said.
In 2003, Minister of Trade and Industry Alec Erwin visited the United States to promote South Africa as a suitable choice for the provision of back- and front-end office functions on an outsourced basis. This means the government has recognised the importance of this emerging market for outsourcing, the statement said.
Erwin said the government is aiming to create an additional 100 000 jobs by 2005, through call-centre outsourcing alone, Herd noted.
“This is the extent of the potential, although I believe that if 100 000 jobs are to be created by the end of next year then something more concrete will have to be done. This is an embryonic market for local companies and it is going to take a lot of capital to break into it and win contracts”. — I-Net Bridge