Gurgaon, Dec 11 : In a comprehensive study, the Everest Group has suggested that South Africa is emerging as credible offshore business destination.

Elaborating on the findings of the study, Nikhil Rajpal, Principal, Everest Group, said, "South Africa presents a significant opportunity for global financial services firms looking to expand their offshore footprint. It offers a 50-60 per cent operating cost savings potential over western markets. Further, we observed that the savings gap between Johannesburg and a low-cost offshore destination like Bangalore has decreased from 30 per cent in 2005 to 15 per cent in 2008 and could further decrease to just
8 per cent in 2012."

The study further shows that the FS-focused BPO industry in South Africa has established significant scale with ~11,000 employees in service providers (includes suppliers and offshore captives).

The study shows that the service provider industry in South Africa has established credible delivery across FS sub-verticals (retail banking, insurance, asset management) and across BPO functions (front and back-office).

Elaborating on the specialized FS skills available in South Africa, Rajpal said, "The potential that South Africa offers becomes evident if you compare the scale of specialized FS skills available in South Africa versus other offshore destinations. While not the largest in every domain, there are clearly certain pockets of meaningful scale. For example, South Africa has 770 actuaries, as compared to 225 actuaries in India, 65 in Philippines and 80 in Czech Republic."

Commenting on South Africa''s growth potential as an offshore destination, Nikhil further added, "South Africa is one of the few global sourcing destinations beyond India and Philippines that can offer sizeable and good quality English language skills at a low-cost. Latin American countries such as Argentina face challenges with good English skills. Nigeria, Jamaica and Kenya have smaller labor pools. Canada and Northern Ireland have higher costs. Mexico and Czech Republic too are more expensive relative to South Africa." (ANI)