Where Next? - Africa
Where Next?
Continuing talent shortages have forced organisations to reconsider their traditional strategies of where and how to operate their businesses around the world. From Hickey’s perspective, that means we are being continually asked ‘WHERE NEXT?’
In a mini-series of publications, we will bring to light lesser-known destinations, which are becoming next frontiers in site selection. To start with, we will look at the African continent from business services perspective and some of the emerging hotspots for customer and technical support roles as well as digital skills.
Egypt
Hardly an unknown destination anymore, in recent years Egypt has become one of the major outsourcing locations globally. With an estimated employment of 175,000 in business services and young, well-educated and multi-lingual (English, French, German) workforce, Egypt is possibly the only destination able to accommodate large scale investments at competitive cost outside the traditional hubs in India and the Philippines. All of the major customer service operators are already present in country (Majorel, Webhelp, Sutherland, Sitel, Teleperformance, etc.), each employing 5,000-7,000 FTE. While Europe is struggling with declining fertility rates and ageing population, Egypt’s youth population (15-34 years old) is exploding and by 2030 insert will be greater than that of the whole of Poland (38 million). Beyond transactional roles, the companies are increasingly adding value-add processes, such as software development. While geopolitical and macroeconomic risks in the region persist and, admittedly, will be there for the years to come, the potential benefits, primarily access to large talent pool, merit the consideration.
Tunisia
If you live in one of the French or Italian-speaking regions of Europe and ever had to settle a customer service request in that language, there is a high chance you might have interacted with one of the 50,000 agents of Tunisia’s burgeoning business service industry. Teleperformance itself employs more than 7,500 people across its five sites in the country. Besides French (more accent-neutral than in neighbouring Morocco) and Italian (widely spoken due to historical reasons and proximity to Libya) languages, English and German speakers are also available, as well as functional digital skills. Tech sector has been growing steadily and accounts for 7.5% of Tunisia’s GDP, similar to tourism revenues. Coupled with low labour costs – a fraction of Eastern European salaries, these factors make Tunisia a worthy contender in your next search for a business services investment location.
Rwanda
For the more intrepid investors, a small landlocked nation of Rwanda might be of an interest. With a population of 13 million people, it is one of the most densely populated countries in the world. In the last release of Ease of Doing Business report in 2020, Rwanda ranked 2nd in Africa (only behind Mauritius) and 38th in the world (ahead of Portugal, Poland or Hungary). It is widely considered as one of the safest, least-corrupt countries and having the best infrastructure in Africa. The talent pool is largely untapped. Since 2003 primary education in the country is free and 98% of children are enrolled in primary school. Average age in the country is 20 years and 70% of population is under the age of 30, youth population is estimated at 4 million and youth unemployment is at 20%. The population speaks English (estimated number of fluent speakers is 1 million) and French (750,000), with 400,000 bilingual English/French. The government is keen to support the investors in providing various tax benefits as well as helping in upskilling programmes. Last but not least, the salaries are approximately a fifth of the rates in Eastern Europe – a help-desk agent earns about EUR 350 per month, and an intermediate software developer EUR 500. One of the first notable investors in the country was Tek Experts, providing technical, cloud and IT support services. Established in 2021, the company employs 200 agents in Kigali and plans to grow by 600 in 2023 (in addition to its centres in Bulgaria, Costa Rica, Vietnam, China and US).
For more information on these and other emerging destinations, please connect with a Hickey EMEA Location Strategy & Incentives expert today: