An in-depth analysis about Vietnam’s potential to be the next outsourcing destination

An in-depth analysis about Vietnam’s potential to be the next outsourcing destination after India and China

http://outsourceportfolio.com, the website which is a prominent outsourcing industry organ has come out with a definitive research report on Vietnam, spelling out in detail the opportunities available to the nation in the realm of outsourcing with particular emphasis on IT outsourcing. The report addresses the key issues of the factors responsible in driving this growth, the role of the government, and the key operating facts, costs and risks involved.

In terms of the regulatory environment the country fares moderately with a 40% of the country’s GDP coming from state owned enterprises. But the government is doing what it can to promote privatization including a 30% reduction in corporate tax for small and medium sized businesses. In terms of intellectual property rights Vietnam is at 77th position out of the 115 countries surveyed and could do with some improvement there. In network readiness too Vietnam has made rapid progress being at no 70 against India’s 54 and China’s 46.

In so far as infrastructure is concerned, Vietnam with its long legacy of war performed creditably at number 70. The government has pledged to spend 11% of GDP on further ramping up architecture. In terms of Human Capital Vietnam has the advantage of possessing a highly educated and well trained work force which takes quite well to computer training. Add to that the lower salary costs (30% to 66 %below India and China’s) and you are looking at serious competition. Vietnam is also making every effort to have quality benchmarks in place.

What makes it particularly attractive is the perception that it is a moderate to low risk country with a stable polity. Corruption and susceptibility to natural disasters were the down sides to an otherwise fairly sanguine outlook.

Whether you’re already into a BPO or are in the planning stages, these resources will help you better plan for the cost so there are no nasty surprises down the line.