Keep Us Strong WikiLeaks logo

Currently released so far... 97115 / 251,287

Articles

Browse latest releases

Browse by creation date

Browse by origin

A B C D F G H I J K L M N O P Q R S T U V W Y Z

Browse by tag

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
ETRD EAGR ETTC EAID ECON EFIN ECIN EINV ELAB EAIR ENRG EPET EWWT ECPS EIND EMIN ELTN EC ETMIN EUC EZ ET ELECTIONS ENVR EU EUN EG EINT ER ECONOMICS ES EMS ENIV EEB EN ECE ECOSOC EK ENVIRONMENT EFIS EI EWT ENGRD ECPSN EXIM EIAD ERIN ECPC EDEV ENGY ECTRD EPA ESTH ECCT EINVECON ENGR ERTD EUR EAP EWWC ELTD EL EXIMOPIC EXTERNAL ETRDEC ESCAP ECO EGAD ELNT ECONOMIC ENV ETRN EIAR EUMEM ENRGPARMOTRASENVKGHGPGOVECONTSPLEAID EREL ECOM ECONETRDEAGRJA ETCC ETRG ECONOMY EMED ETR ENERG EITC EFINOECD EURM EENG ERA EXPORT ENRD ECONEINVETRDEFINELABETRDKTDBPGOVOPIC EGEN EBRD EVIN ETRAD ECOWAS EFTA ECONETRDBESPAR EGOVSY EPIN EID ECONENRG EDRC ESENV ETT EB ENER ELTNSNAR ECHEVARRIA ETRC EPIT EDUC ESA EFI ENRGY ESCI EE EAIDXMXAXBXFFR EETC ECIP EIAID EIVN EBEXP ESTN EING EGOV ETRA EPETEIND ELAN ETRDGK EAIDRW ETRDEINVECINPGOVCS EPEC ENVI ELN EAG EPCS EPRT EPTED ETRB EUM EAIDS EFIC EFINECONEAIDUNGAGM EAIDAR ESF EIDN ELAM EDU EV EAIDAF ECN EDA EXBS EINTECPS ENRGTRGYETRDBEXPBTIOSZ EPREL EAC EINVEFIN ETA EAGER EINDIR ECA ECLAC ELAP EITI EUCOM ECONEFINETRDPGOVEAGRPTERKTFNKCRMEAID EARG ELDIN EINVKSCA ENNP EFINECONCS EFINTS ECCP ETC EAIRASECCASCID EINN ETRP EAIDNI EFQ ECOQKPKO EGPHUM EBUD ECONEINVEFINPGOVIZ ENERGY ELB EINDETRD EMI ECONEFIN EIB EURN ETRDEINVTINTCS EIN EFIM ETIO ELAINE EMN EATO EWTR EIPR EINVETC ETTD ETDR EIQ ECONCS EPPD ENRGIZ EISL ESPINOSA ELEC EAIG ESLCO EUREM ENTG ERD EINVECONSENVCSJA EEPET EUNCH ECINECONCS ETRO ETRDECONWTOCS ECUN EFND EPECO EAIRECONRP ERGR ETRDPGOV ECPN ENRGMO EPWR EET EAIS EAGRE EDUARDO EAGRRP EAIDPHUMPRELUG EICN ECONQH EVN EGHG ELBR EINF EAIDHO EENV ETEX ERNG ED
KMDR KPAO KPKO KJUS KCRM KGHG KFRD KWMN KDEM KTFN KHIV KGIC KIDE KSCA KNNP KHUM KIPR KSUM KISL KIRF KCOR KRCM KPAL KWBG KN KS KOMC KSEP KFLU KPWR KTIA KSEO KMPI KHLS KICC KSTH KMCA KVPR KPRM KE KU KZ KFLO KSAF KTIP KTEX KBCT KOCI KOLY KOR KAWC KACT KUNR KTDB KSTC KLIG KSKN KNN KCFE KCIP KGHA KHDP KPOW KUNC KDRL KV KPREL KCRS KPOL KRVC KRIM KGIT KWIR KT KIRC KOMO KRFD KUWAIT KG KFIN KSCI KTFIN KFTN KGOV KPRV KSAC KGIV KCRIM KPIR KSOC KBIO KW KGLB KMWN KPO KFSC KSEAO KSTCPL KSI KPRP KREC KFPC KUNH KCSA KMRS KNDP KR KICCPUR KPPAO KCSY KTBT KCIS KNEP KFRDCVISCMGTCASCKOCIASECPHUMSMIGEG KNNB KGCC KINR KPOP KMFO KENV KNAR KVIR KDRG KDMR KFCE KNAO KDEN KGCN KICA KIMMITT KMCC KLFU KMSG KSEC KUM KCUL KMNP KSMT KCOM KOMCSG KSPR KPMI KRAD KIND KCRP KAUST KWAWC KTER KCHG KRDP KPAS KITA KTSC KPAOPREL KWGB KIRP KJUST KMIG KLAB KTFR KSEI KSTT KAPO KSTS KLSO KWNN KPOA KHSA KNPP KPAONZ KBTS KWWW KY KJRE KPAOKMDRKE KCRCM KSCS KWMNCI KESO KWUN KPLS KIIP KEDEM KPAOY KRIF KGICKS KREF KTRD KFRDSOCIRO KTAO KJU KWMNPHUMPRELKPAOZW KEN KO KNEI KEMR KKIV KEAI KWAC KRCIM KWCI KFIU KWIC KCORR KOMS KNNO KPAI KBWG KTTB KTBD KTIALG KILS KFEM KTDM KESS KNUC KPA KOMCCO KCEM KRCS KWBGSY KNPPIS KNNPMNUC KWN KERG KLTN KALM KCCP KSUMPHUM KREL KGH KLIP KTLA KAWK KWMM KVRP KVRC KAID KSLG KDEMK KX KIF KNPR KCFC KFTFN KTFM KPDD KCERS KMOC KDEMAF KMEPI KEMS KDRM KEPREL KBTR KEDU KNP KIRL KNNR KMPT KISLPINR KTPN KA KJUSTH KPIN KDEV KTDD KAKA KFRP KWNM KTSD KINL KJUSKUNR KWWMN KECF KWBC KPRO KVBL KOM KFRDKIRFCVISCMGTKOCIASECPHUMSMIGEG KEDM KFLD KLPM KRGY KNNF KICR KIFR KM KWMNCS KAWS KLAP KPAK KDDG KCGC KID KNSD KMPF KPFO KDP KCMR KRMS KNPT KNNNP KTIAPARM KDTB KNUP KPGOV KNAP KNNC KUK KSRE KREISLER KIVP KQ KTIAEUN KPALAOIS KRM KISLAO KWM KFLOA
PHUM PINR PTER PGOV PREL PREF PL PM PHSA PE PARM PINS PK PUNE PO PALESTINIAN PU PBTS PROP PTBS POL POLI PA PGOVZI POLMIL POLITICAL PARTIES POLM PD POLITICS POLICY PAS PMIL PINT PNAT PV PKO PPOL PERSONS PING PBIO PH PETR PARMS PRES PCON PETERS PRELBR PT PLAB PP PAK PDEM PKPA PSOCI PF PLO PTERM PJUS PSOE PELOSI PROPERTY PGOVPREL PARP PRL PNIR PHUMKPAL PG PREZ PGIC PBOV PAO PKK PROV PHSAK PHUMPREL PROTECTION PGOVBL PSI PRELPK PGOVENRG PUM PRELKPKO PATTY PSOC PRIVATIZATION PRELSP PGOVEAIDUKNOSWGMHUCANLLHFRSPITNZ PMIG PREC PAIGH PROG PSHA PARK PETER POG PHUS PPREL PS PTERPREL PRELPGOV POV PKPO PGOVECON POUS PGOVPRELPHUMPREFSMIGELABEAIDKCRMKWMN PWBG PMAR PREM PAR PNR PRELPGOVEAIDECONEINVBEXPSCULOIIPBTIO PARMIR PGOVGM PHUH PARTM PN PRE PTE PY POLUN PPEL PDOV PGOVSOCI PIRF PGOVPM PBST PRELEVU PGOR PBTSRU PRM PRELKPAOIZ PGVO PERL PGOC PAGR PMIN PHUMR PVIP PPD PGV PRAM PINL PKPAL PTERE PGOF PINO PHAS PODC PRHUM PHUMA PREO PPA PEPFAR PGO PRGOV PAC PRESL PORG PKFK PEPR PRELP PREFA PNG PGOVPHUMKPAO PRELECON PINOCHET PFOR PGOVLO PHUMBA PRELC PREK PHUME PHJM POLINT PGOVPZ PGOVKCRM PGOVE PHALANAGE PARTY PECON PEACE PROCESS PLN PRELSW PAHO PEDRO PRELA PASS PPAO PGPV PNUM PCUL PGGV PSA PGOVSMIGKCRMKWMNPHUMCVISKFRDCA PGIV PRFE POGOV PEL PBT PAMQ PINF PSEPC POSTS PHUMPGOV PVOV PHSAPREL PROLIFERATION PENA PRELTBIOBA PIN PRELL PGOVPTER PHAM PHYTRP PTEL PTERPGOV PHARM PROTESTS PRELAF PKBL PRELKPAO PKNP PARMP PHUML PFOV PERM PUOS PRELGOV PHUMPTER PARAGRAPH PERURENA PBTSEWWT PCI PETROL PINSO PINSCE PQL PEREZ PBS

Browse by classification

Community resources

courage is contagious

Viewing cable 06COLOMBO1926, BUSINESS PROCESS OUTSOURCING: A GROWTH OPPORTUNITY FOR

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Understanding cables
Every cable message consists of three parts:
  • The top box shows each cables unique reference number, when and by whom it originally was sent, and what its initial classification was.
  • The middle box contains the header information that is associated with the cable. It includes information about the receiver(s) as well as a general subject.
  • The bottom box presents the body of the cable. The opening can contain a more specific subject, references to other cables (browse by origin to find them) or additional comment. This is followed by the main contents of the cable: a summary, a collection of specific topics and a comment section.
To understand the justification used for the classification of each cable, please use this WikiSource article as reference.

Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol). Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #06COLOMBO1926.
Reference ID Created Released Classification Origin
06COLOMBO1926 2006-11-16 10:53 2011-08-25 00:00 UNCLASSIFIED Embassy Colombo
VZCZCXRO0653
RR RUEHLMC
DE RUEHLM #1926/01 3201053
ZNR UUUUU ZZH
R 161053Z NOV 06
FM AMEMBASSY COLOMBO
TO RUEHC/SECSTATE WASHDC 4748
INFO RUCPDOC/USDOC WASHDC
RUEHNE/AMEMBASSY NEW DELHI 0231
RUEHKA/AMEMBASSY DHAKA 9603
RUEHIL/AMEMBASSY ISLAMABAD 6533
RUEHKT/AMEMBASSY KATHMANDU 4590
RUEHKP/AMCONSUL KARACHI 2058
RUEHCG/AMCONSUL CHENNAI 7075
RUEHGV/USMISSION GENEVA 1526
RUEHC/DEPT OF LABOR WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEHLMC/MILLENNIUM CHALLENGE CORP
UNCLAS SECTION 01 OF 03 COLOMBO 001926 
 
SIPDIS 
 
SIPDIS 
 
DOL/ILAB FOR TINA MCCARTER 
 
DRL/IL FOR LAUREN HOLT 
 
STATE FOR SCA/INS 
 
MCC FOR D NASSIRY AND E BURKE 
 
GENEVA PASS USTR 
 
COMMERCE FOR EROL YESIN 
 
 
E.O 12958: N/A 
TAGS: ECON ELAB EIND ETRD CE
SUBJECT:  BUSINESS PROCESS OUTSOURCING:  A GROWTH OPPORTUNITY FOR 
SRI LANKA 
 
 
1.  Summary. As the business process outsourcing industry (BPO) 
continues to grow in South Asia, Sri Lanka is looking to expand its 
share of the market.  However, attractive features such as low labor 
costs, low operating costs and government tax incentives are 
somewhat overshadowed by industry constraints, including inadequate 
education and IT infrastructure.  The ongoing ethnic conflict also 
discourages new investors and BPO clients.  Despite these 
challenges, there is room for growth and there are possible niches 
for Sri Lanka in providing disaster recovery centers and 
specialized, high-end services.  End Summary. 
 
--------------------------------- 
Growing BPO Presence in South Asia; Limited Sri Lanka Growth 
--------------------------------- 
 
2.   The Business Process Outsourcing (BPO) industry continues to 
pour money into South Asia. Companies are looking for cheaper 
options for conducting basic business processes, and investors are 
taking advantage of labor market efficiencies in Asia to offer these 
services.  The industry has grown to include many sophisticated and 
technical processes and has spread throughout South and East Asia. 
 
 
3.  Sri Lanka has seen some investment in the BPO sector, which 
currently employs just over 4,000 people.  Sri Lanka is attractive 
to BPOs because of its low labor costs, low attrition rates, low 
operating costs, and significant government tax incentives. 
However, a number of factors are deterring greater investment in Sri 
Lanka including a relatively small labor pool, the ongoing ethnic 
conflict, a lack of necessary specialized skills, and IT constraints 
and costs.  Addressing these problems will help Sri Lanka tap into a 
growing industry as the country tries to diversify and reduce its 
reliance on textiles. 
 
--------------------------------------------- ---- 
Basic to High-End Services:  All Are in Sri Lanka 
--------------------------------------------- --- 
 
4.  There are three main levels of BPO services offered in Sri 
Lanka, and U.S. companies are engaged in all three.  The first level 
involves basic data entry services and document conversions, for 
example conversion of hard copy texts to e-books.  The second level 
involves more sophisticated processes such as desktop publishing and 
basic accounting services.  The third level includes high level 
services such as investment research, financial modeling, and 
quantitative analysis. 
 
--------------------------------------------- --- 
Poor English Skills and Scarcity of University Graduates Constrain 
Growth 
--------------------------------------------- --- 
 
5.  The growth of the BPO industry in Sri Lanka faces several 
constraints.  BPOs tell us one major constraint is the lack of 
English language skills.  Although Sri Lanka has a high rates of 
primary education enrollment and literacy, BPOs say it is difficult 
to find enough secondary school graduates with adequate English 
language skills.  BPOs that provide low or mid-level services are 
willing to hire "A-level" (12 years of schooling) or "O-level" (10 
years of schooling) high school graduates, but need them to have 
working level English.  English was widely taught and spoken two 
generations ago, but for nearly 50 years most instruction has been 
in Sinhala or Tamil.  English is being reintroduced in schools, but 
it will take many years to see significant improvement.  U.S. BPO 
executives tell EconOffs that while companies provide internal 
training in "soft skills," such as communication skills, the 
applicant must possess basic English language skills to be hired. A 
 
COLOMBO 00001926  002 OF 003 
 
 
2006 baseline sector analysis of the BPO industry commissioned by 
the Information and Communication Technology Agency (ICTA) of Sri 
Lanka indicates that 95 percent of BPOs consider the ability to 
communicate in English their most important skill requirement. 
 
6.  The dismal state of Sri Lanka's tertiary education system limits 
the skilled labor pool.  Sri Lanka's university system is entirely 
state run and has not managed to keep up with the growing demands of 
Sri Lanka's student population or the business community.  According 
to the Chairman of the University Grants Commission, only 15 percent 
of those who qualify for university entrance are actually admitted. 
Sri Lankan universities are not offering the subjects or the level 
of quality instruction necessary to meet business needs.  In 
addition, there are few foreign schools present in Sri Lanka. 
Foreign schools are not allowed to confer Sri Lankan degrees, 
although they can offer foreign degrees.  The ICTA study concludes 
that the quality and size of the Sri Lankan labor pool are 
inadequate to meet the competitiveness and growth needs of the BPO 
sector. 
 
--------------------------------------------- --------- 
IT and Transportation Capacities Limit Expansion 
--------------------------------------------- ---------- 
 
7.  BPOs tell us Sri Lanka's information technology infrastructure 
is inadequate.  BPOs are able to obtain dedicated lease lines for IT 
connectivity, but they say there is inadequate redundancy, or 
back-up capacity.  In many cases, if an broadband line goes down, 
there is no way to continue to provide services to clients.  There 
is also a lack of IT capacity outside of Colombo.  BPOs we talked to 
said they would like to open offices in secondary cities like Kandy 
and Galle to take advantage of cheaper labor costs and untapped 
English language skills, but they cannot because of IT constraints. 
Executives also told EconOffs that IT costs in Sri Lanka are about 
40 percent higher than in India.  The ICTA study states that nearly 
half of BPOs surveyed listed telecommunications facilities as an 
infrastructure constraint and nearly 40 percent were dissatisfied 
with broadband facilities. 
 
8.  Road and mass transit systems also fail to meet BPO needs. 
Industry contacts tell us conducting business outside Colombo is 
practically impossible because of the lack of good roads connecting 
secondary cities to the airport.  They also say Colombo needs a 
reliable 24-hour mass transit system to make it easier for employees 
to get to work. BPOs often have employees working around the clock 
on 2 or 3 different shifts to provide real-time services to clients. 
City buses are overcrowded, do not run late at night, and are often 
unsafe for women traveling alone.  To compensate, most BPOs offer 
transport to and from work for employees as well as meals, since 
restaurants are not open at night and employees can not travel home 
to eat.  Nearly 60 percent of BPOs surveyed in the ICTA study 
considered mass transport service the leading infrastructure 
bottleneck to BPO operations and growth. 
 
--------------------------------------------- ---- 
Lack of Industry Awareness Discourages Applicants 
--------------------------------------------- ---- 
 
9.  Finally, BPO executives say there is a need to raise awareness 
of the BPO industry among the Sri Lankan public.  BPO is a 
relatively new sector for the country, and increased awareness would 
result in a reduction in the stigma of working in the BPO sector and 
more applicants for BPO jobs.  One executive told us that he knows 
of high school graduates with excellent language skills working in 
less technically-demanding jobs (the Pizza Hut counter was given as 
an example),because they do not know about the BPO industry and are 
reluctant to apply. 
 
 
COLOMBO 00001926  003 OF 003 
 
 
--------------------------------------- 
Political Concerns Also Deter Investors 
--------------------------------------- 
 
10.  The ICTA study revealed that 67 percent of the BPO sector is 
concerned about domestic civil and political stability, in part 
because they fear that domestic strife could disrupt service 
delivery to clients.  Our contacts at U.S. BPOs emphasized that one 
bomb at the Colombo airport or port could scare away BPO clients. 
One bomb could also destroy a company's telecommunications 
connectivity, making it impossible to deliver services. 
 
11. U.S. BPO executives also say there is a need for legislation 
regarding working women.  Technically, women in Sri Lanka are not 
allowed to work past 8 p.m., but the government has issued a waiver 
for the BPO sector.  However, women remain reluctant to take BPO 
jobs because of the stigma associated with working late at night. 
Revising the laws might also help change public perceptions. 
 
------------------------------------- 
Government Incentives Possibly Fading 
------------------------------------- 
 
12.  One positive force for the BPO sector has been Sri Lanka's 
Board of Investment (BOI).  The BOI provides investment incentives 
and expedited services to foreign investors.  To date, the BPO 
sector has benefited from the BOI.  However, the BOI is considering 
raising the standards for new businesses to qualify for BOI 
approval.  Currently, there is no minimum capital investment 
requirement for BPOs or IT companies, only a requirement that those 
companies have at least 15 employees.  The proposed regulations 
would require a mandatory initial capital investment of $150,000 for 
all companies, including BPO and IT companies.  U.S. BPOs point out 
correctly that many BPO and IT companies would not need to make an 
initial $150,000 investment to set up business in Sri Lanka and the 
new regulation will effectively discourage new companies from coming 
here.  The proposed regulation, aimed at keeping small beauty salons 
and restaurants from getting BOI incentives, may have the unexpected 
effect of discouraging two prominent industries from continuing to 
expand and invest in Sri Lanka's economy. 
 
13.  Comment:  Despite these challenges, the Sri Lankan BPO sector 
provides attractive investment possibilities.  The government and 
business community need to actively market the country as an 
advantageous site for back-up operations and disaster recovery 
centers.  Sri Lanka's smaller size in comparison to India makes it 
ideal for these smaller scale operations.  Sri Lanka can also create 
a niche for itself by focusing on specialized, high-end services 
where volume and scale are less important.  US companies have been 
successful in Sri Lanka and will continue to thrive as long as they 
keep implementing creative solutions to the country's capacity 
constraints. 
 
BLAKE