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Lebanon has proven to be full of opportunities for businesses seeking to save money, gaining wider market shares and obtaining deliveries in less time. The BPO industry is one of […]

Lebanon has proven to be full of opportunities for businesses seeking to save money, gaining wider market shares and obtaining deliveries in less time. The BPO industry is one of the most promising sectors for bringing new jobs to emerging economies, and according to the OECD, it boosts growth-enhancing properties such as spill over effects and economies of scale. Forbes, for instance, estimates that through 2012 the BPO industry accounted for a global revenue of $100 billion dollars, making this sector not only extremely lucrative but also fundamental for the economic growth of developing countries.

The Lebanese case is illustrative of this trend, as the country has embraced the BPO industry to the point of making it one its fastest growing sectors, and nobody can deny that Lebanon has done it well. Many factors contribute to the growth of BPOs in Lebanon, governmental incentives being one of the most relevant. According to the Investment Development Authority of Lebanon (IDAL), a governmental agency aimed at promoting Lebanon as an investment destination, such incentives range from providing sectorial information to choose the best market location, to tax exemptions up to 100% of the amount. The Lebanese government has also oriented part of its legislation towards the attraction of BPO companies. Such transformations have included the Telecommunications Law No.432, aimed at liberalizing the sector, the Investment Law No. 360 that established tax exemptions as a constitutional grant, and the Competition Law, which prohibits sectorial dominance.

Regionally, Lebanon also holds comparative advantages that set it far ahead of its peers in attracting BPO companies. An extensive infrastructure, a business-oriented political class and an active business environment make Lebanon both attractive and a safe bet for investors, and strong human capital add up to Lebanon’s comparative advantages. The country’s educational system ranks 10th in the Global Competitiveness Report, beating other BPO-oriented nations such as Jordan (31st), India (34th), and the Philippines (45th).
This way, BPO companies satisfy the needs of their clients and maintain high quality in their services. According to the Telecommunications Ministry of Lebanon, the BPO contact centers established in the country now provide specialized services for industries as varied as airlines, hotels, hospitals, insurance companies, and financial services. Today, this sector employs an estimate of 5,050 people in Lebanon, and the numbers keep growing.

The strategy to attract foreign investment in BPO industries has also motivated the settling of local companies specialized in the sector. Today, Lebanese companies such as South Business Innovation Centre, Capital Typing and SmartSource have all applied the foreign know-how in outsourcing and, through the beneficial policy of the government, have fostered a promising BPO industry born and based in Lebanon. Those Lebanese companies provide their services to international giants such as Lloyds, British Petroleum, DHL, and General Electric.

But what has motivated such interest in Lebanon for the BPO industry? A working paper from the World Bank on ICT industries state that the development of sectors such as the BPO increased after the last financial crisis evidenced the weaknesses of commodity-based countries (typically developing nations); offshore service industries came in handy, as they’re business-to-business and based on multiyear contracts. As affected as it was from the crisis, it would be no surprise that Lebanon also took part in this trend. It remains to be seen if Lebanon will become the next India, a referent for ICT and BPC industries worldwide. The policies set in motion by its government, plus the talents of its people, seem to be the right formula to achieve it.

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