"Your article "Australia: A country in denial" (ZDNet Australia, 23 March 2004) questions the value of findings in the KPMG Competitive Alternatives report on the basis that Australia was a sponsor of the study.
"The KPMG study received sponsorship from more than 60 economic development agencies across nine countries. Given that the countries we were assessed against also sponsored the survey, it is difficult to see how Australia's sponsorship could have significantly influenced the result. The study was conducted independently by KPMG, using objective, measurable data.
"Your article also suggested that lack of participation of countries such as India was a failing of the KPMG study. This reflects a lack of understanding of the market in which Australia is competing.
"It is important to recognise that the global ICT outsourcing market is often differentiated based on the type of ICT work that is being outsourced. Australia is often competing for ICT work that is different, and in some cases of higher value, from that being sought by countries such as India.
"The focus of the KPMG study on developed nations is particularly relevant to high value-added ICT services. The study ranked Australia above our competitors for this type of work, including Canada and Ireland. These countries currently attract significant high-valued activities in the global offshoring market from countries such as the United States.
"When an independent international study demonstrates Australia's strengths in the international ICT sector, the Government believes these results should be highlighted and promoted to help further develop the sector. Australian ICT companies, who are out there selling our industry to the world, should also know about these good results.
"It would be unfortunate for such positive outcomes to be reduced by any analysis that does not fully consider the merits and context of such studies".