Invest Australia defends offshoring record

Invest Australia, the government agency responsible for attracting investment from overseas, has defended its record in attracting offshoring investments following criticism from influential industry bodies.

Invest Australia, the government agency responsible for attracting investment from overseas, has defended its record in attracting offshoring investments following criticism from influential industry bodies.

At the Media Connect forum in the Hunter Valley on Sunday, consultancy Swamy & Associates published a report commissioned by the Australian Computer Society that claimed Australia was in "critical need" of a federal ICT body - similar to India's NASSCOM (National Association of Software and Service Companies) -- because Australia is not properly promoting its skills to the global marketplace.

Sri Annaswamy, founder & director of Swamy & Associates, told ZDNet Australia&nbsp that although Australia has the necessary skill sets and its workforce is between 20 percent and 40 percent cheaper than the US or the UK, Australia is losing business because the country as a whole is not being marketed properly.

"The prime issue is that as of now, when people look for an outsourcing destination, not a single service provider has Australia on their map. Australia is ideally suited... It simply has not been marketed," said Annaswamy.

Rob Durie, chief executive officer of the Australian Information Industry Association (AIIA) said that although Invest Australia is the "right body" to promote Australia as an outsourcing destination, it is not aggressive enough.

"Offshoring is continuing to gather momentum and Australia is still succeeding to bring work here, despite the fact that we are probably not going about it in a strategic and aggressive fashion as we would like," said Durie.

Analyst firm Gartner counts Australia as an "emerging country" when it comes to outsourcing and places it alongside Bulgaria, Jamaica and New Zealand in terms of competitiveness and preparedness for outsourcing deals. China, Canada, Poland, South Africa and Spain are ranked above Australia but India is still "head and shoulders above the competition".

In response to this criticism, Garry Draffin, chief executive officer of Invest Australia, said that Australia has been an "enormous beneficiary" of outsourcing work and is enjoying "considerable success" at the high end of the market.

"I think Australia's capabilities in the area are well known and well regarded and have been responsible for Australia being a net beneficiary of outsourcing globally. We have been enormously successful in attracting high-end jobs to Australia," said Draffin.

Despite this, Swamy & Associates's Annaswamy believes that the best way to shake up Australia's position on the global outsourcing stage is to create a federal body to concentrate solely on outsourcing.

"We are not seeing an active pitch coming out of any of the states. My personal view is that there should be an umbrella organisation - similar to NASSCOM -- It should not be an existing organisation because they all have existing mandates," said Annaswamy.

The AIIA's Durie disagrees that there should be another body and argues that the AIIA is an equivalent organisation. However, he concedes that NASSCOM is more focussed on outsourcing and Invest Australia has room for improvement: "Because offshoring is the single business model that NASSCOM members use, they put all their energies into promoting India as an offshore destination. We have a much broader remit and a much broader range of interests among our members."

"Are [Invest Australia] putting enough emphasis on IT and working properly with all the states? Probably not. But I don't think we need any new bodies. But could we do better? Absolutely," added Durie.

Invest Australia's Draffin also dismissed the need for a new organisation to focus on outsourcing and claimed that this was the first time he had had been told of any "issues" with Australia's position on outsourcing.

"We have a very close relationship with both those organisations (the AIIA and the ACS) overseas and around the world. I have never heard a word from them that we have an issue in terms of outsourcing. There is a lot going on and Australia is enjoying considerable success," added Draffin.

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