Industry news

In a piece by the Urban Land institute with input from PricewaterhouseCoopers LLP on the most attractive South Asian cities for property investment in 2017, Bangalore and Mumbai came first and second with Manilla in third. Commercial property is key with all three cities popular with BPO and ITO firms. The survey was done prior to the scrapping of 500 and 1000 rupee notes, so any effect of this development is not accounted for.

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We may finally be getting a hint as to how president-elect Trump will run the United States of America after his inauguration in January. It looks like TPP (the Trans-Pacific Partnership), a trade deal to lower tariffs between major economies such as the US, Japan, Australia, Canada and Mexico, is in the president-elect’s sights. Mr Trump has promised to quit the deal on his first day office, in an attempt to bring jobs back to US shores. Because the TPP is such a major trade deal covering 40% of the world economy, this would be a huge blow to globalisation and creating the most efficient process of production to help consumerism by keeping prices low. The loss of TPP would be a sad blow to the remaining 11 countries, but it would be a huge loss to the US.

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US Presidential news at Sourcing Focus.

The first Brexit budget will be announced (the first official one anyway) this week as the government will attempt to fit the UK economy for Brexit negotiations. Featuring heavily in the budget will be the digital economy, including cyber security and a new £400 million fund for digital infrastructure development with a further £740 million for the introduction of 5G services and fibre connections. Currently, the average broadband speed for the UK is well below ‘full-fibre’ connection speed. The UK economy does need this sort of investment, it helps business innovate and helps keeps people connected. The first Brexit budget will hopefully have a focus on good, long-term investments like this that will help the economy grow.

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More tech news at Sourcing Focus.

IBM will triple the number of cloud data centres in Britain according to the company, another boost to the UK tech sector after Brexit. The news follows similar good news about UK investment from both Google and Facebook. Is the tech sectors resilience after Brexit such a surprise, not really. Europe has never had the same entrepreneurial zeal for tech as the US (think of all the big internet giants) and therefore many don’t rue the loss of EU restrictions. The UK has a big tech talent pool, is willing to invest and is enthusiastic about the digital economy, it has the greatest proportion of e-commerce to overall retail spending in the world (17%). Not every sector is concerned about Brexit.

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The IMF has released a second tranche of loans to Sri Lanka, helping the microeconomic and financial conditions in the country. Worries about emerging economies like Sri Lanka have intensified over previous weeks on the potential of a US fed rate rise and the election of Donald Trump. The Sri Lankan rupee has seen a lot of pressure of late as speculators held on to dollars due to global geopolitical conditions and concerns about potential tax changes in the budget leading foreign investors to exit government securities. The IMF loan will boost confidence that the country is on track.

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More news on Sri Lanka at Sourcing Focus.

The UK government will look into how it’s procurement programme can be used to drive innovation in SME’s according to the Prime Minister. Speaking at the CBI (Confederation of British Industry) yesterday, Mrs May said the review would “increase its impact and give more innovators their first break”. It is good to hear more support for the UK tech industry from the government. In her speech to the CBI, Mrs May also announced a consultation into the government’s new industrial strategy, and a $2bn per year increase in funding for science and technology research and development.

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More news at Sourcing Focus.

The GSA and HfS Research have announced a global partnership to bring innovation, skills and knowledge to the wider sourcing industry. The two sourcing organisations will work together to deliver events and research for the global sourcing community throughout 2017. Members of the GSA will now be able to receive HfS blogs as they are published and HfS thought leadership, buy-side members will be given exclusive access to Premium HfS research. HfS will help bring the global sourcing standard to North America thanks to its strong foot print on the continent, while HfS Research CEO and Chief Analyst, Phil Fersht, will join the standards advisory group. Kerry Hallard, CEO of GSA UK said “We are delighted to partner with HfS Research to develop programmes that will greatly benefit GSA members as they grapple with the challenges of this dramatically evolving industry.” Mr Fersht said “We are delighted to be partnering with such a forward thinking organisation and engaging with their members.”

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Outsourcing firm Mitie has disappointed markets again, issuing a second profit warning in the year citing difficult market conditions and rising staff costs. The firm experienced a £100million loss in the half-year results, down from a profit of £45million in the same period last year. The company will be putting its healthcare unit ‘under strategic review’, and will be withdrawing from the home healthcare market, a sign that the company has identified the troublesome markets. The good news for Mitie is that the firm has won some big contracts with the likes of Network Rail and Scottish Police Authority. Ruby McGregor-Smith, CEO of Mitie said “The first half of this year has been difficult. Second half performance is expected to improve with our new operating model as we adapt to market conditions." Ms McGregor-Smith will be leaving Mitie at the end of 2016 after ten years at the helm.

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It is amazing how the digital world can help people adapt in new ways to problems that arise. The removal of large banknotes (500 and 1000 rupee notes) from circulation by the government to clamp down on the black market has caused disruption to the circulation of money in the country. However, mobile payment firm, Paytm, logged a record number of transactions on Saturday, suggesting that people are avoiding the hassle by moving to mobile banking. It is more evidence of how Fintech is changing financial systems around the globe and how people are quickly adapting to new technology.

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More Fintech news from Sourcing Focus.

Healthcare Payer BPO Market size was valued at over USD 15 billion in 2015 and is anticipated to grow at over 7% CAGR from 2016 to 2023. Major drivers contributing to industry growth include increasing geriatric population and healthcare costs, shift in ICD-10 coding system, innovations and developments in IT and regulatory changes. North America healthcare payer BPO market led the global industry with over 50% of the total revenue generated in 2015. Factors such as high number of number of public and private medical expenses, presence of strong repayment agenda, high number of claim records and favourable government policies played key part in the strength of the strength of the market. Asia Pacific is forecast to be the most attractive region, mainly due to high economic growth, increase in public and private medical expenses, growing number of insurance services in rural and urban areas, and government policies.

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