Kenya welcomes American IT investment

Kenyan IT and telecom observers said on Wednesday that the move from American ICT company Digital Divide Data (DDD) to establish a business process to outsource in Kenya could be a watershed moment for the country. They said that if Kenya can start attracting companies wishing to outsource their activities, the country’s economy and IT industry could be on the verge of what one analyst said is a “major breakthrough.”

Timothy Jones, a London-based IT and securities analyst said that although Kenya’s economy and telecom sectors have, in recent years, continued an upward surge, “what was truly needed was one company to enter the market to take it to the next level.”

This company could very well be DDD.

“What DDD offers is a much needed boost to the overall confidence of other international corporations who have been interested in Kenya for a long while. Here in the UK, I am hearing some chatter about the possibilities of other corporations looking very seriously at the Kenyan market for outsourcing options,” he said.

DDD said it would invest nearly $1.4 million in a 300-seat outsourcing center that would handle its call center, data entry, electronic publishing and back-office operations.

The Rockefeller Foundation reported that it would fund the initial investment while Cisco and Microsoft would offer additional technology support.

According to DDD Managing Director Amolo Ng’weno, some 75 percent of the jobs the firm plans to handle will be delivered to local workers. The remaining one-quarter will come from the international market, he said.

“Kenya is a dynamic market, leading companies are finally modernizing their businesses … this is the right time for DDD to bring strong BPO service offerings to clients in East Africa,” he added.

For analysts, it is an optimistic moment the Kenyan market, as it enables the country and the government to tackle IT investment from a multiple number of sources.

William Khalil, a Mombasa-based trader, said that he believes it is only a matter of time before the country is able to begin truly competing on the global stage of outsourcing.

“This is a really important moment in Kenyan IT history because it could mean the future of the country could see an investment explosion. It might be early, but that’s the sentiment here on the ground,” he said.

The DDD move is largely seen as a confidence booster among investors in BPO business and although the country’s IT sector had a slow start and was unable to secure major deals with international companies, the solid infrastructure in the county could spur future investment.

“When we went to Cambodia 10 years ago, many thought it could not be done, but today the country has a vibrant BPO industry,” said Jeremy Hockenstein, DDD’s global CEO.

“We believe that there is huge potential and expect the sector to grow … in another five years or a bit more BPO will be a key sector for the economy.”

by Jonathan Terry