The following is excerpted from a June 2013 article by Victoria Prussen Spears, CEO of Global Outsourcing Information, published in the Nearshore Executive Alliance Newsletter, available here: A South American Jewel, Colombia Shines as a Leading Outsourcing Destination
Colombia is a dynamic and desirable country for IT and BPO outsourcing, and worthy of serious consideration for companies thinking of investing abroad.
1. Impressive Vital Statistics:
- Population 46.4 million
- Over a half million people in each of eight metropolitan areas
- GDP (PPP): $472.0 billion/5.9% growth
- Inflation (CPI): 3.4%
- Inflow: $13.2 billion
- 126 universities and 203 higher education centers
- Close proximity to the U.S.
- Time-zone friendly
- More than 78,000 graduates per year in technical and professional careers
- Low public utilities, housing, and labor costs.
2. A Leading Investment Destination:
Site Selection Magazine’s Global to Invest Report ranked Colombia in the Top Five Latin American five countries in 2013. Bogotá ranked fourth in an impressive field of the Top 10 Metropolitan Areas in Latin America.
3. An “Aggressive” Influx of Global Leaders:
According to Peter Ryan, an analyst at Ovum, “the influx of global leaders into Colombia during the past several years has been aggressive, and it has included (among others) Teleperformance, Sitel, Convergys, Sutherland, and most recently Sykes.”
In addition, the following global companies are doing business in Colombia:
- Unilever, which is constructing its most technologically advanced detergent plant anywhere in the world;
- Renault, which expanded its production plant in 2011 to assemble a new line of SUVs for the Colombia market and for export from Colombia – including to Mexico;
- Itochu, which recently acquired 20 percent of Drummond’s thermal coal operations and which is working with Drummond to expand its mining business as well as rail and port facilities to be able to expand production;
- Kimberly-Clark, which has established one of its three Global Innovation Centers in Colombia;
- HP, which opened a new global service center in Medellin in 2011;
- GM, which in 2012 constructed a stamping plant in Bogotá with a capacity to produce 60,000 cars per year; and
- Eaton, which recently acquired ESI de Colombia, a value-added reseller of industrial electrical equipment and engineering services.
4. “Unwavering” Industry and Government Support Leading to Higher Destination Rankings:
Tholons, which found that Colombia had “real-world potential as a viable destination in the region for ITBPO services” due in part to the “unwavering support from its industry and government stakeholders to promote Colombia as a global IT-BPO destination,” noted that three cities in Colombia, Medellin, Bogotá, and Bucaramanga, were among its best movers on the 2013 Top 100 Outsourcing Destinations Rankings and Report.
5. People Skills, Availability, and Language Skills:
According to A.T. Kearney, Colombia made its Global Services Location Index “after performing particularly well in the people skills and availability.” Moreover, Colombian Spanish, with its “neutral accent,” allows call centers in Colombia “to serve people throughout the Spanish-speaking world with relative ease.” English language skills are ascending, with several English improvement programs opening, and all Colombian students receiving English training.
6. Doing Business Rankings:
According to The World Bank, Colombia is a regional leader in narrowing the gap with the world’s most efficient regulatory practices. Colombia’s most notable regulatory improvements have been in the areas of starting a business, paying taxes, protecting investors, and resolving insolvency. Statistics support these conclusions. Here are three that we found of particular interest:
- Colombia’s ranking on the “ease of doing business” rose from 79 among the 175 economies included in 2006 to 45 among the 185 included in 2012;
- The total number of newly registered businesses in the country rose from 33,752 in 2006 to 57,768 in 2011; and
- Government reforms have reduced the time required to start a business from 60 days to 14, the cost from 28 percent of income per capita to eight percent, and the number of procedures from 19 to nine.
7. Inter-American Development Bank Support:
Perhaps recognizing Colombia’s outstanding advances in its IT/BPO sector, and its potential for future growth, The Inter-American Development Bank (IDB) recently approved a $12 million loan to promote the expansion of the offshoring services industry. The sector accounted for $640 million, or 13 percent of total services exports in 2011, the IDB noted. A government program based on public-private partnerships between universities and businesses is being set up to provide both technical knowledge and “soft” skills (customer service and English) that address the industry’s specific needs. Over a four year period, the program will train 4,000 young people. In addition, small and medium-sized enterprises in the global services sector will get a boost, with a stated goal of raising the value of exports from the “15.5 percent of total exports to 21.6 percent by the end of the program.”
Of course, there are so many more reasons companies should consider Colombia for IT/BPO outsourcing and investment that the country is on our list for a future comprehensive Outsourcing Destinations Guide.
 2013 Index of Economic Freedom, available at http://www.heritage.org/index/pdf/2013/countries/colombia.pdf.
 Global Best to Invest Report Site Selection magazine, May 2013, available at http://www.siteselection.com/issues/2013/may/cover.cfm.
 Peter Ryan, Ovum, May 1, 2013, available at http://ovum.com/2013/05/01/colombian-outsourcing-must-move-to-higher-value-delivery/.
 2013 Top 100 Outsourcing Destinations Rankings and Report Overview, available at http://www.tholons.com/TholonsTop100/pdf/Tholons%20Top%20100%202013_Rankings%20and%20Report%20Overview.pdf.
 Offshoring Opportunities Amid Economic Turbulence, A.T. Kearney Global Services Location Index™, 2011, available at http://www.atkearney.com/gbpc/global-services-location-index/full-report/-/asset_publisher/BfF4luBmAV5G/content/offshoring-opportunities-amid-economic-turbulence-%E2%80%94-the-a-t-%C2%A0kearney-global-services-location-index%E2%84%A2-2011/10192.
 “World Bank. 2013. Doing Business 2013: Smarter Regulations for Small and Medium-Size Enterprises. Washington, DC: World Bank Group. DOI: 10.1596/978-0-8213-9615-5,” available at http://www.doingbusiness.org/~/media/GIAWB/Doing%20Business/Documents/Annual-Reports/English/DB13-full-report.pdf.
 Colombia to promote its offshoring services industry with IDB assistance, IDB News Release, Dec 14, 2012, available at http://www.iadb.org/en/news/news-releases/2012-12-14/promotion-of-colombian-outsourcing,10264.html.