IDB boosts the global services industry in Latin America and the Caribbean at the Outsource2LAC Forum

Major services providers from India, the Philippines, the United States, and Europe meet with Latin American businesses in a second annual outsourcing event

MEDELLÍN, Colombia – The region of Latin America and the Caribbean (LAC) has great potential in the field of outsourcing and offshoring, a $350–$500 billion global industry. Firms from the region currently account for less than 10 percent of this sector.

In a move to strengthen the region’s services industry, the second Latin America and the Caribbean Outsourcing and Offshoring Forum (Outsource2LAC) is being held in Medellín, Colombia, December 4–6. The event is being sponsored by the Integration and Trade Sector of the Inter-American Development Bank, the Cooperation and Investment Agency of Medellín (ACI), Proexport Colombia, and the Program for the Transformation of Production of Colombia (PTP).

Outsourcing and offshoring refer to the practice of transferring certain business activities to a foreign country in order to increase operating efficiency, reduce costs, and gain access to more qualified employees. According to the World Trade Organization, Argentina, Brazil, Chile, Costa Rica and Mexico lead the region in outsourcing services exports over the past decade, although they continue to trail far behind Asia, the world leader in this sector.

More than 500 companies participating in the forum include large services providers from India, the Philippines, the United States, and Europe. They are holding more than 1,100 meetings with nearly 100 potential customers and investors interested in expanding operations in LAC. In addition, representatives of trade and investment promotion agencies from more than 20 LAC countries met with officials with venture capital funds to review a sampling of firms that offer particularly innovative approaches in this field.

Industry experts such as Avinash Vashistha, CEO of Accenture in India, and Humberto Andrade, director of Infosys in Latin America, emphasized opportunities for businesses in software development, data management, technical support and client service, marketing activities, product design, and digital animation, among others.

“For Latin America and the Caribbean, the global services sector represents an important opportunity to diversify and add sophistication to its exports,” said Fabrizio Opertti, chief of the IDB’s Trade and Investment Unit. “Increases in the quality of the region’s human resources, the region’s proximity to the number one market in the world, the 12-hour time difference with Asia, a Spanish-speaking population, and competitive costs, clearly are advantages that the region must continue to utilize to gain a larger share of this market,” he added.

The IDB is currently preparing a joint loan operation with the Productivity Transformation Program(PTP) of the Ministry of Trade, Industry, and Tourism of Colombia, to support the Colombian services sector. “The services outsourcing sector has a great future in Colombia. The Productivity Transformation Program is working to make Colombia a global platform forthe export of services¨ said Juan Carlos Garavito, Director of the PTP who opened the event jointly with Antoni Estevadeordal, Manager of the IDB Integration and Trade Sector and Tomas Mejia, Secretary of Development of the City of Medellin.