Global Business Services incentive to bolster youth employment opportunities

7th January 2019 By: Tasneem Bulbulia - Creamer Media Reporter

Global Business Services incentive to bolster youth employment opportunities

Trade and Industry Minister Dr Rob Davies

The Global Business Services (GBS) incentive, which came into effect from January 1, will create employment opportunities for the youth in South Africa, says Trade and Industry Minister Dr Rob Davies.

He notes that the opportunities will be especially in the areas of medium to high complexity jobs, with the youth to be exposed to servicing major global brands out of South Africa.

“Areas of special interest by potential global investors are legal services, finance and accounting and information technology services. South Africa’s value proposition remains a compelling business case for most global companies that are looking to optimise their customer solutions at a globally competitive rate,” says Davies.

The sector has demonstrated a yearly growth rate of 22% on average and it is expected that this growth rate will continue to increase over the next five years.

Davies indicates that, through continuous monitoring of the sector, global benchmarking studies and investor engagements, the Department of Trade and Industry (DTI) has been able to present a revised GBS incentive.

He notes that the GBS incentive is a three-tier programme that includes noncomplex jobs, medium complexity jobs and high complexity jobs, with an increase in value across all three tiers.

Further, another change is the reduction in the minimum criteria of 50 jobs across all levels of work to a minimum of 30 jobs for medium to high complexity jobs.

“To ensure that South Africa delivers the best quality services at the right price, the eligibility criteria was amended to include a minimum salary threshold of R60 000 a year for entry-level agent roles,” highlighted Davies.

Although South Africa offers significant cost arbitrage in comparison to its source markets such as the UK, the US and Australia, with the added benefit of the incentives, the country is slated to attract a considerable share of the opportunities in the sector presented by the global market.

The DTI has partnered with the industry to develop a value proposition for investors which will support government’s objectives of job creation within South Africa, primarily for the youth and to increase export revenue.

BPeSA, the industry body representing the GBS sector in South Africa, welcomed the revised incentive package, which it said would ensure that South Africa remains highly competitive as an offshore delivery location for GBS in an increasingly more competitive global market impacted by the digital economy.

South Africa’s value proposition for GBS is underpinned by good quality English-speaking talent, significant cost savings, a strong foundation in contact centre and niche services, evolving capabilities for next-generation services for digital contact centres and world class infrastructure.

The new GBS incentive has replaced the previous Business Process Services incentive.