Nigeria has suddenly realized that outsourcing can help diversify the country’s economy and reduce her dependence on oil.
The federal government said last week that an enabling environment would be created to attract interests from countries with rich history of outsourcing such as India and the Philippines.
This is with the hope that outsourcing would ensure strong economic growth and create more jobs in the country.
The country depends on crude oil for more than 90 per cent of her earnings. However, World Bank and US-based Outsourcing Development Initiative of Nigeria (ODIN) experts said Nigeria can benefit from the outsourcing industry, which generates some $100 billion annually.
Outsourcing is the management and/or day-to-day execution of an entire business function by a third party service provider. It always involves a considerable degree of two-way information exchange, co-ordination, and trust.
Outsourcing has made profound impact in countries like India, Philippines and China, which are now developing their IT industry, offering the bedrock of services remotely to many corporations in Americas and Europe.
India alone earns about $47 billion from outsourcing annually. Nigeria can still benefit from the numerous advantages outsourcing offers a country.
It has the advantage of English language, which is the official language of the business globally.
The country also boasts of, telecommunications infrastructure, huge population and education as well as comparatively low cost labour.
If Nigeria can attract even 1.0 per cent of the total outsourcing activities, it will increase the country's GDP by more than 30 per cent and transform the economy from agrarian to a service sector based economy.
Today, the appalling statistics is that oil accounts for 20 per cent of the country’s $295 billion GDP as at 2007 and 95 per cent foreign exchange.
But no meaningful headway can be made in outsourcing unless the seemingly intractable problem of power of supply is addressed.
Again, the country must also work on its reputation in the international community, the perception of Nigeria as a country were anything goes does not help the business of outsourcing.
Government should encourage the pockets of outsourcing companies already in Nigeria with some kind of waivers to attract other.
A special agency to promote and regulate outsourcing business should be established in the country.
