turning chile into the service export platform of choice
Download
Skip this Video
Download Presentation
Turning Chile Into The Service Export Platform of Choice

Loading in 2 Seconds...

play fullscreen
1 / 18

Turning Chile Into - PowerPoint PPT Presentation


  • 290 Views
  • Uploaded on

Turning Chile Into The Service Export Platform of Choice . Chilean Economic Development Agency -CORFO. How do we manage risk?. Being a predictable country, where institutions work, rules are clear and properly enforced. Being fiscally responsible (surplus as the rule)

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Turning Chile Into ' - medwin


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
turning chile into the service export platform of choice

Turning Chile Into The Service Export Platform of Choice

Chilean Economic Development Agency -CORFO

how do we manage risk
How do we manage risk?
  • Being a predictable country, where institutions work, rules are clear and properly enforced.
  • Being fiscally responsible (surplus as the rule)
  • Chile has been quoted by The Economist, WSJ and Financial Times as an example to follow on its economic and financial model in the context of the current crisis.
what do experts say about chile
What do experts say about Chile?

Santiago is 18th among 50 cities –

“Top 50 Emerging Global Outsourcing Cities 2009”

Others: Rio de Janeiro (26), San Jose CR (27), Mexico City (30), Monterrey (41)

A.T. Kearney Ranks 7th among 50 countries – “Global Services Location Index 2007”

EIU Ranks 15th among 60 countries –

“Future leaders in global offshoring 2006”

slide4

At a Glance

  • Population: 16.3 M
  • GDP: USD 183 B
  • GDP per capita: USD 12.7 K
  • FDI (net inflow): USD 7.34 B
  • Annual inflation: 7%
  • Unemployment: 7.5%
  • Adult literacy rate: 96%
  • Corporate tax: 17%
  • Remitted Profits Tax: 35% (corporate tax is credited towards remitted profits)
  • Tariffs
    • General 6%
    • Hardware 0%
    • 95% of imports pay no tax (FTAs)

Time zone alignment

Overnightflights to the U.S.

Sources: World Bank, EIU, IMF, A.T.Kearney, Chile’s Central Bank

slide5

“Chile will remain one of the world’s most attractive emerging-market investment locations”

COUNTRY VIEW 2006 EIU

Chile’s Business Environment Stands out in Latin America and Beyond

  • The most stable and competitive economy in Latin America
    • Ranked 1st in the region and #26th worldwide by WEF World Competitiveness Index 2007 (125 nations)
      • Mexico (#52), Costa Rica (#63), Brazil (#72) and Argentina (#85)
    • Ranked Best Place to do Business in the region by EIU in 2006
      • 4th among emerging countries and 20th in global ranking
    • Lowest country risk (Moody´s, Fitch and S&P)
    • Santiago ranked 3rd by América Economía magazine as the best city for doing business in Latin America (2008).
  • Strong, transparent institutions and regulatory framework are an example for the region
    • Ranked 5th in the region by Transparency International in its Corruption Index
      • 23rd in global rankings
    • Ranked 3rd in the region by World Bank in terms of “Ease of Doing Business”
      • 40th worldwide
  • Positioned as a gateway to the world
    • Free trade agreements with intellectual property protection
    • Low tax burden and extensive network of double taxation treaties
    • Favorableforeign investment regime (DL 600) in force since 1974
slide6

Chile’s Business Climate is Reflected in Moderate Tax Burden and Flexible Labor Laws

  • 78
  • 2,600
  • 60
  • 52
  • 46
  • 52
  • 40
  • 33
  • 33
  • 69.2
  • 24
  • 20
  • 552
  • 20
  • 37.1
  • 316
  • 27
  • 25.9
  • 11
  • 10
  • Number of tax payments per year
  • Man hours required to file taxes
  • Total tax rate
  • (% of profits)
  • Difficulty of hiring
  • Rigidity of work hours
  • Difficulty of firing
  • Overall index
  • Mexico
  • Brazil
  • Chile

Source: World Bank (www.doingbusiness.org) 2008

slide7

Chile is a Gateway to the World

Web of trade agreements provides

access to more than 90% of OECD economies

Web of double taxation agreements

covers most of OECD economies

Spain Norway

Portugal Denmark Poland

UK Sweden Croatia

France Finland Hungary

Netherlands Czech Republic

Switzerland

Ireland

Italy

Iceland

Switzerland

Lichtenstein

Norway

Canada

USA

Turkey

Russia

Japan

Canada

USA

European

Union

South

Korea

South

Korea

Mexico

China

Mexico

Brunei

El Salvador

Costa Rica

Guatemala

Nicaragua

Honduras

India

Malaysia

China

Vietnam

Cuba

South

Africa

Malaysia

Panama

Uruguay

Paraguay

Angentina

Brazil

Singapore

Argentina Peru

Brazil Venezuela

Ecuador Paraguay

Australia

New Zealand

New Zealand

In negotiation

In negotiation

Source: Direcon www.direcon.cl

slide8

At Competitive Costs

  • EIU Worldwide Cost of Living survey 2007:
  • Chile among lowest in the world

UBSThe world\'s most expensive

cities in 2008 (among 70 cities)

Sources: UBS (www.ubs.com), EIU (www.eiu.com),

slide9

Strong Government Commitment to Turn Chile into a Global IT Service Platform

“Increasing productivity also means innovation… I want this to be a country that not only exports copper, but also mining software; not only fruit, but also techniques to pack and preserve foods; not only salmon, but also vaccines to prevent diseases in fish.

The public sector will increase its spending on research and development by 50%. Our goal is for our country to spend more than 1% of GDP on research and development by its Bicentennial in 2010.

We will increase our efforts to make Chile a platform for the export of services.”

Michelle Bachelet, President of Chile

State of the Nation Address 2006

slide10
The Global Services Cluster has been created to turn Chile

into the near-shore platform of choice for BPO, KPO and ITO.

A Private & Public Partnership has been created for this purpose, that includes Government agencies, business associations, academia and foreign companies.

Chile´s Strategy to develop the Global Services Industry

successful experiences
Successful Experiences

Altec - Santander Bank

Citigroup

Regional platform for IT services

Year established: 2001

Investment: US$ 7.7 M

Services to Spain and Latin America to 10 banks in 8 countries include:

Software dev. and maintenance

US$ 60M in sales

600 employees

High productivity (CMM5 in 2005)

Costs are 60% less than in Europe

  • Regional platform for IT services
    • Year established: 2002
    • 130 employees (all bilingual)
    • Considering expanding services to US for:
    • Tech support
    • Infrastructure services
    • Technical documentation

BBVA

JP Morgan

  • Regional platform for IT services
  • -Opened in 2005
    • 150 employees
    • Services include:
    • Software development
    • Data centers support
    • Infrastructure services
  • Regional platform for IT services
  • Year established: 2006
  • 50 employees (all bilingual)
  • Services to US and Latin America branches for:
  • Software dev.
  • Infrastructure management services
slide13

Successful Experiences

EXPERIAN

ORACLE

EVALUESERVE

  • Year established: 2007
  • Activities: develop and localize software, provide analytical and information services to manage risk and reward of commercial and financial decisions to US customers
  • Scope: 200 bilingual IT technical people and engineers, sales rep, business managers
  • Customer Support Shared Service
  • Year established: 2007
  • Activities: Technical support, sales, app development for customers in Latin America and US
  • Scope: 200 bilingual IT technical people and engineers, sales rep, business managers
  • IT and customer service center
  • Year established: 2007
  • Activities: develop and localize software, provide analytical and information services to manage risk and reward of commercial and financial decisions to US customers
  • Scope: 350 bilingual IT technical people and engineers, sales rep, business managers

ORION SYSTEMS

  • Year established: 2008
  • Activities: Indian provider that develops software for US customers
  • Scope: 120 bilingual IT technical people and engineers
successful experiences14
Successful Experiences

TCS BPO center

Yahoo!

-Year established: 2006

-Research lab: Web search and mining hosted in the Engineering School of University of Chile

-Scope: 10 PHDs

-Only other Yahoo research center outside the U.S. besides Barcelona

-Why Chile? One of the few places where “people are ‘understanding’ the internet”

  • Year established: 2005
  • Investment: US$ 30 million
  • Numerous advantages for its plans to their operations: economic and political stability, risk-free, low costs, high-quality human resources, good infrastructure.
  • Scope: Workforce of 1,500.
  • Chile considered a hub for Latam

Other Examples

  • Regional Contact Centers
    • Air France/Delta Airlines
  • KPO
    • GE
  • Software Development
  • Software AG/ Synopsys/Intersystems
  • Shared Services
    • BHP Billiton/Unilever/Zurich
  • IT outsourcers
    • IBM / Sonda / EDS / Accenture/CSC

“The main reason to be in Chile is the local talent”.

Director of Yahoo! Research

chile offers top talent for offshore operations
Chile Offers Top Talent for Offshore Operations
  • An estimated 1% to 1.5% of the country’s population are professionals able to work in English
  • Corfo´s National Register for English speakers has 15,145 people certified on the TOEIC test
  • Chilean accent considered closer to “neutral Spanish” than several of its neighbors, though still quite different from the likes of Spain or Mexico
  • Currently ~10,000 annual output of college and university engineering graduates and growing
  • 10+ large universities around the Santiago area, and 60 total in the country
  • Over 25% of all school enrollment in technical fields or sciences
  • Over 20 MBA programs offered explain the high quality of management education in Chile
  • Renowned for strong skills in finance and telecom related sectors

Source: A.T.Kearney Report 2007

reducing the english gap
Reducing the English Gap

Corfo created a National Register for English speakers certified with the TOEIC test.

Total: 37,000 people registered nationwide

Profile:

  • 70% university students and technicians under 30 years
  • 39% are related to engineering, IT and business careers

Corfo launched a 100% funded program to train English capacities for 1,000 IT engineers in Santiago. In 2009, Corfo will fund an English program for 2,000 IT engineers in various cities.

Corfo´s register and training programs are available for foreign companies looking for local talent

slide17

Local IT Market is Expanding Rapidly

  • 500+ IT companies in Chile
  • Over 75,000 people employed
  • Size distribution (annual sales US$) Less than 852K (small) 49%
  • 853K to 3,5M (medium) 28%
  • 3,6M or more (large) 23%

IT Sales

Annual sales (US$Billions)

Source: ACTI – IDC , 2008

ad