Why Sri Lanka - The Statistics


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Sri Lanka is emerging as a prime destination for Finance and Accouting Outsourcing. This presentation allows to gain an in depth understanding of the BPO/KPO environment in the country an why companies across the globe should look at Sri Lanka as an alternate center of services

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Why Sri Lanka - The Statistics

  1. 1. IT/BPO Services – Why SriLanka? – The Statistics
  2. 2. Sri Lanka Macro Education & Economic Infrastructure Literacy Indicators Legal IT/BPO Framework Industry 2
  3. 3. Key Socio-economic Indicators GDP growth 8.3% in 2011 Major sectors Service (55% of GDP), Industry (29%), Agriculture GDP per capita US$ 2,836 (12%) GDP US 58.5 billion Labour force 8.1 million persons Inflation rate 7.8% Literacy rate 92% Exchange rate USD =129, Pound Life expectancy 74.9 Years 208, at birth Despite the Global Economic Crisis, Sri Lanka is one of the few countries with a positive GDP growthSource: Central Bank of Sri Lanka
  4. 4. Sri Lanka Macro Education & Economic Infrastructure Literacy Indicators Legal IT/BPO Framework Industry 4
  5. 5. Sri Lanka’s IT & Telecom Infrastructure Three international 04 fixed line operators submarine cables providing redundancy 5 mobile service providers 33 external gateway operators Broadband, leased line and satellite connectivity widely available Sri Lanka was among the first South Asian countries to establish a 3G, 4G and LTE 22 internet service Networks providers
  6. 6. Property and Office Space Office space is available and relatively affordable, and new developments are underway Real Estate Mauritius 192 Companies in Colombo do not Sri Lanka 227 report office space to be a problem Bangladesh 252 Several BPO companies are Philippines 262 housed in class A facilities downtown as opposed to in Malaysia 316 suburban campuses UK 343 Office rent, class A office space in In addition, class B real estate in major business hub, US$/m2 Egypt 368 Colombo is easier to come by and of better quality than in Vietnam 440 many emerging market capitals Pakistan 459 Private actors have created dedicated IT/BPO industry parks - China 472 not yet at capacity India 918 UAE 978 Source: CB Richard Ellis 2011, A.T. Kearney analysis
  7. 7. Quality of Infrastructure Sri Lanka also offers superior infrastructure to most other low-cost countries Infrastructure UAE 6.3 Overall infrastructure quality, Malaysia 5.7 including transportation and utilities, surpasses that of South UK 5.6 Asian and almost all Southeast Asian competitors Sri Lanka 4.7 This is a welcome difference to Mauritius 4.6 other locations, often plagued by inefficient infrastructure China 4.2 Colombo’s Bandaranaike Egypt 3.9 International Airport has more India 3.8 flights to India than any other country Pakistan 3.5 Second International Airport Philippines 3.4 being constructed in Overall Infrastructure Hambanthota Vietnam 3.1 Quality Score Bangladesh 2.8 Source: World Economic Forum Global Competitiveness Report 2011- 2012, A.T. Kearney analysis
  8. 8. Sri Lanka Macro Education & Economic Infrastructure Literacy Indicators Legal IT/BPO Framework Industry
  9. 9. Increase in IT Qualified Graduates
  10. 10. Growing Resource Pool in Accounting
  11. 11. Literacy and Secondary Enrollment Literacy and secondary enrollment rates are on a par with developed countries Secondary Enrollment Rate, % Adult Literacy Rate, % UAE 98% UK 99% Enrollment rates UK 96% Philippines 95% With free primary and secondary Sri Lanka 90% China 93% education and an extensive university system, Sri Lanka has Mauritius 89% Vietnam 93% had a very strong education Philippines 82% Malaysia 92% system for decades Sri Lanka’s literacy rate is the Egypt 81% Sri Lanka 91% highest in South Asia, positioning China 76% UAE 90% it to train a large number of high- quality personnel Malaysia 70% Mauritius 88% Vietnam 70% Egypt 66% India 59% India 62% Bangladesh 44% Bangladesh 56% Pakistan 33% Pakistan 55% Note: Gross enrolment ratios measure total enrolment as a percentage of the total population corresponding to the relevant age group Source: UNESCO 2011, A.T. Kearney analysis.
  12. 12. Tertiary Education Executives rank Sri Lanka’s tertiary education among the best in Asia Education quality UK 6.0 Malaysia 5.0 Sri Lanka’s management schools Malaysia 5.0 UAE 4.9 are ranked among the best in Asia; their math and science India 4.9 China 4.7 programs also rank highly Sri Lanka 4.7 India 4.7 Sri Lanka currently has 23 accredited universities, more UAE 4.7 UK 4.5 than 25 private institutes offer Philippines 4.4 Sri Lanka 4.2 diplomas in IT China 4.3 Vietnam 4.2 Foreign universities are partnering with local Mauritius 4.1 Mauritius 4.1 institutions to offer degree programs, and some are setting Pakistan 4.0 Pakistan 3.6 up their own campuses in Sri 3.9 3.3 Bangladesh Bangladesh Lanka Vietnam 3.3 Philippines 3.1 Quality of Math & Egypt 3.0 Egypt 2.4 Science Schools Quality of Management Schools
  13. 13. Professional Education 5 professional accounting bodies • Chartered Institute of management accounting (CIMA) • Association of chartered certified accountants (ACCA) • Institute of chartered accountants of Sri Lanka (ICASL) • Institute of certified management accountants (CMA) • Association of accounting technicians (AAT) Other emerging professional qualifications • CMA Australia • CMA (Canada) • CPA (Australia) BCI certified professional qualifications • Offered at selected institutes • E.g. Lanka BPO Academy
  14. 14. ICT Literacy 40 % - 2011 75 % - by 2016 Dept of Census and Statistics
  15. 15. Sri Lanka Macro Education & Economic Infrastructure Literacy Indicators Legal IT/BPO Framework Industry
  16. 16. Legal Framework Sri Lanka follows the British commercial law principles. Sri Lanka Accounting Signatory to standards based on IAS international treaties on and fast track adoption intellectual property of IFRS (IP) rights LEGAL FRAMEWORK Sri Lanka has also Signatory to the latest enacted electronics united nation’s e- transactions act and contracting convention computer crimes act
  17. 17. Personal Safety Contrary to perception, Sri Lanka is one of the lowest-risk emerging markets in terms of personal safety Safety & Security UAE 6.1 Egypt 0.6 Sri Lanka scores very well 5.9 Homicides per Mauritius from a terrorism and crime Sri Lanka 1.2 100,000 perspective people, Most Malaysia 5.7 1.3 Populous City India MNCs in the country report Sri Lanka 5.6 not to have had to stop UAE 1.5 operations in Sri Lanka, China 5.2 UK 2.6 whereas they have suffered Bangladesh 5.2 disruptions in most other Malaysia 4.4 global locations due to UK 5.1 Bangladesh 5.3 industrial disputes, natural disasters, and terrorist attacks Vietnam 5.0 Philippines 5.3 Colombo scores exceptionally India 4.5 Mauritius 7.4 well in terms of personal Philippines 4.3 N/A safety, as demonstrated by its China low homicide rate Egypt 3.8 N/A Business Cost of Vietnam 3.0 Terrorism, Score Pakistan Pakistan N/A Source: World Economic Forum Global Competitiveness Report 2011-2012, UN Office in Drugs and Crime 2011, A.T. Kearney analysis
  18. 18. Sri Lanka Macro Education & Economic Infrastructure Literacy Indicators Legal IT/BPO Framework Industry
  19. 19. VISION of SLASSCOM “IT/BPO Industry to become 1 Billion USD in Export Revenue and create 80,000 Jobs ” 946 750 IT/BPO Export Revenue in mill USD 605 484 387 310 210 2009 2010 2011 2012 2013 2014 2015 Actual Estimated Source: ICT Export Value Survey (Aug 2011- PWC publication)
  20. 20. Did you know? Capital markets in Boston, Nairobi, Colombo, Mauritius, Ghana, and Croatia, use an advanced Automated Trading / Depository Software for Stock Exchanges, that was designed and developed by a Sri Lankan Company: Millennium IT Leading Swedish ERP provider has its research and development facility located in Sri Lanka employing over 500+ software developers: Industrial and Financial Systems Airline systems software for Emirates, Braathens, and Air Arabia was developed by a Sri Lankan company: John Keells Computer Services
  21. 21. Did you know Mobile application developed by a local company was ranked among the top 3 Enterprise Mobile Applications at the Ericsson Mobile Application Awards: hSenid International Pacific Asian Travel Association gold award for the best WEB site, was designed and developed by a Sri Lankan company: Affno A Sri Lankan company engaged in Open Source middleware (capitalized by Intel) was the winner of Red Herring Asia 100 award: WSO2
  22. 22. Sri Lanka is clearly emerging as a Global IT/ BPO Sourcing Destination Ranked among the Top 25 in the AT Kearney Global Services Location Index (GSLI) in 2011 Ranked number 5 in financial attractiveness, ahead of India, China and all of CEE Gartners 30 Leading Locations for Offshore Services (2010-2011). Sri Lanka is a Included among the Top 10 in Asia pacific. hidden gem for 12th in the top ranking destinations in IBM Global Location Trends Report outsourcing - A.T Kearney 2012 Ranked among the top 10 emerging global destinations by Global Services Magazine. Sri Lankan’s geographical location, infrastructuralSri Lanka is another Asian country that has facilities, direct access to the Indian market, high qualitysucceeded in positioning itself as an standards of the workforce, open economy and various freealternative to India. trade agreements make it an attractive outsourcing destination.- IBM Global Location Trends Report 2010 – Global Services Destinations Compendium 2010
  23. 23. Sri Lanka being recognized as a Global Center of Excellencefor Financial Accounting Outsourcing (FAO) Source: Tholons
  24. 24. New York Times Southern China has its assembly plants. India has customer support centers, research laboratories and low-cost lawyers. And Sri Lanka’s contribution to global outsourcing? Accountants — thousands of them, standing ready to crunch the world’s numbers. Wages in Sri Lanka for financial outsourcing are about one- third less than in neighboring India, and hiring educated employees is easier in Sri Lanka, according to executives who do business in both countries. – 29 November 2010
  25. 25. Industry Wages For typical positions in the knowledge services sector, Sri Lanka offers amongst the lowest wages in the benchmark countries Vietnam 3,574 Bangladesh 7,800 Professional Pakistan 8,683 Sri Lanka 4,104 Compensation Bangladesh Sri Lanka 8,996 4,200 Sri Lanka offers remarkably low costs, considering the value offered India 10,170 Philippines 4,653 According to international salary Vietnam 11,291 Pakistan 5,374 surveys, compensation costs for sample IT positions are 10% lower Philippines 11,371 Annual IT Programmer India 5,451 compensation Annual BPO Analyst than India and 20% lower for BPO cost, US$ Egypt 5,913 compensation functions Egypt 13,894 cost, US$ In addition to low costs, companies Malaysia 16,868 China 9,121 consistently report low attrition 23,576 Malaysia 10,398 China Attrition rates in Sri Lanka tend to be just under 20%, whereas rates Mauritius 33,704 Mauritius 14,145 in India and the Philippines typically range from 20-25% in IT to UAE 40,504 UAE 17,895 30-35% in BPO 28,679 44,297 UK UK Note: All wages are annual and fully loaded. Fully loaded compensation includes benefits, taxes, and bonus. Source: Mercer HR Consulting 2011, Watson Towers 2011, A.T. Kearney analysis
  26. 26. Workforce and Employment 40,000 35,615 35,000 IT Workforce ITES/ BPO Workforce 29,211 30,000 Total Workforce 24,505 25,000 21,914 20,629 20,000 18,268 17,827 15,179 15,871 14,268 13,701 15,000 11,384 8,634 10,000 5,450 4,000 5,000 - 2006 2007 2008 2009 2010 Est Source: ICT workforce Survey 2010)
  27. 27. Global Presence Global Brands having offshore centers in Sri Lanka – Due to Quality – Better cost arbitration Select MNCs Select clients of operating in Sri Lanka Sri Lankan firms
  28. 28. What Sri Lanka Offers to the World… Untapped resource pool • 100,000 A/L qualified students each year • IT Graduates – 4000+ per year • Non technical University graduates • Accountants • Lawyers & Law students (British System) Infrastructure • 1 Private IT park already available • 2 Government IT parks being promoted • 3 submarine cables with international bandwidth Our Offering • High-end, Niche IT/BPO Systems & Services
  29. 29. For Further Details Contact: Dhananjaya Rajaguru InfoMate (Private) Ltd 04,Leyden Bastian Road, Colombo 01, Sri Lanka E-mail : dhananjaya.ssc@keells.com Telephone : +94 11 214 9724 Mobile : +94 71 547 8636
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