South Africa is rated only the third-most attractive country for outsourcing in Africa, according to a survey of information and communication technology (ICT) outsourcing in Africa.

The ‘Outsourcing to Africa: A Relative Ranking of 15 Country Locations’ survey, which was compiled by India’s Cybermedia, ranked Egypt, followed closely by Mauritius, South Africa, Tunisia and Morocco, as the top destinations. The study also provides a general overview of the current activities and issues related to ICT outsourcing in the country.

It reveals that infrastructure is a key part of being able to offer outsourcing capabilities.

Egypt, Mauritius and South Africa also ranked highly in popu- lace exposure to ICT, including people’s related skills abilities.

Other factors, such as the business environment, political risk, availability of bandwidth and economic outlook, also weighted the ranking. The country came eleventh and fifteenth respectively in geopolitical risk and currency risk.

The findings of the report were discussed at a two-day Africa Outsourcing Summit hosted by CBC Technologies, with responses to the research coming from South Africa’s Trade and Industry Minister, Mandisi Mpahlwa, and representatives from other countries.

The survey scored South Africa second for infrastructure, first in electricity availability and telecommunications and data transfer costs, second in network readiness and infrastructure costs, fourth in availability and penetration, and fifth in road and rail networks. The country is in the top ten in all other categories.

South Africa came third in people skills, education, language and domain skills, second in quantity, fourth in working satisfaction and ICT exposure, fifth in human resource costs and eleventh in quality.

South Africa secured third place in the lower-level abstraction of the business environment by coming first in ICT security, cyber and intellectual property rights laws and contribution of services to gross domestic product.

The country had the second- highest ranking in foreign exchange reserves and in ease and cost of finance.

Further, the country came in overall third for share of ICT in exports and legislative risk and fifth in tax rate and share of services in export.

“Although South Africa does not have an integrated national ICT policy, discrete policies and legislation have been in place and are efficiently implemented for ICT projects, resulting in a firm, efficient, and cost-effective ICT infrastructure being in place in most activity areas,” says the report.

According to the World Economic Forum’s ‘Global Information Technology’ report, South Africa has one of the most modern and developed telephone systems in Africa and a vibrant ICT sector, with an annual investment of $9,6-billion.

The report says that there are concrete government initiatives that are supporting ICT and related infrastructure. Overall government plans for infrastructure spending total about R416-billion over the next three years, which is an investment size possibly not seen since 1994.

“Information technology (IT) outsourcing is a growing business in South Africa, taking up the largest share of all IT service categories and making up more than a third of the R30-billion IT services market, according to a study in 2008 by research and advisory firm IDC. Gartner, the international research group, rates South Africa as one of its top 30 software development outsourcing destinations, with 2007 research putting it on par with Israel in the Europe, Middle East and Africa region, and alongside Australia and India globally,” the report concludes.