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The Cost of Business Process Outsourcing in Dubai

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Despite undeniable success in retail, financial services, tourism, and real estate and enviable geographical advantages, Dubai's attempts to establish itself as a center for business process outsourcing are failing. According to The Hindu, it's not for lack of talent. Rather, it's the cost of living in Dubai that is a major factor:

Dubai is seeking to attract Business Process Outsourcing (BPO) trade in the region in direct competition from India, but higher cost in setting up these centres is acting as a dampener. Although the World Economic Forum, which has adjudged UAE economy as the most competitive Arab economy praising the region's strong entrepreneurial skills, has also noted its lack of educational reforms and reliance on migrant workers. Of late higher costs from rising rents and spiraling inflation has proved to be a setback for businesses in the UAE, especially in Dubai. Analysts believe, India still has an edge over Dubai in attracting call centres, that require basic communication skills of individuals - available at a cheaper price. India's expertise in information technology and expertise in BPO business makes it a natural hub for call centres. Especially, when high inflation, soaring house rents are forcing employers to raise their operational budgets - the cheaper alternatives.

To my eyes, Dubai's development trajectory seems designed to attract high new wealth individuals into the Emirate and to move low income service workers to the outlying, northern Emirates. This is underscored by the fact that I have yet to see anything resemble "affordable housing" being built amidst all of the shiny residential skyscrapers and internationally-themed housing communities. If this trend continues, I see little hope likelihood that Dubai will be on the line when I call for customer service.

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