Outsourcing Statistics in Asia 2020

Outsourcing Statistics in Asia 2020: Fast Facts and Highlights on Top Countries for Outsourcing Services

Global outsourcing has been an integral part of business operations and management over the past three decades. When it comes to choosing the best outsourcing destination, there are many considerations such as the country’s labor laws and overall business environment, workforce competitiveness and competence, the status of its tech and software industry, among many other factors.

According to Grand View Research, the market size for global outsourcing will reach $405.6 Billion by 2027. Cost efficiency, increased diversity of skills, and better quality and performance are among the top reasons why companies outsource their business functions. The most commonly outsourced tasks are accounting, digital marketing, and IT-related services

There is a strong tendency towards hiring a remote team in Asia for delivering various business processes, infrastructure solutions, and application services in big and small firms in various industries worldwide. What makes the countries in Asia an attractive outsourcing destination? Here is a brief summary of pros and cons of the top ten outsourcing service destinations in Asia.
China
77.9 (#31/190)
73.9 (#28/141)
84.292 (#30/63)
India
71.0 (#63/190)
61.4 (#68/141)
64.952 (#48/63)
Indonesia
67.6 (#73/190)
64.6 (#50/141)
58.011 (#62/63)
Malaysia
81.5 (#12/190)
74.6 (#27/141)
82.390 (#27/63)
Nepal
63.2 (#94/190)
51.6 (#108/141)
No Record
Philippines
62.8 (#95/190)
61.9 (#64/141)
59.439 (#56/63)
Singapore
86.2 (#2/190)
84.8 (#1/141)
99.373 (#2/63)
Taiwan
80.9 (#15/190)
80.2 (#12/141)
90.194 (#16/63)
Thailand
80.1 (#21/190)
68.1 (#40/141)
68.434 (#39/63)
Vietnam
69.8 (#70/190)
61.5 (#67/141)
No Record

*The Ease of Doing Business Index is a benchmark of the conduciveness of a country’s regulatory requirements for conducting business operations.

**The Global Competitiveness Index is a benchmark of a country’s ability to use its resources productively for providing sustained economic growth and prosperity for its citizens.

***The Digital Transformation Index is a benchmark of a country’s capacity and readiness for digital technology adoption towards business competitiveness and overall economic transformation.

China

At A Glance

1.4 billion

2019 Population

$14.14 trillion

Gross Domestic Product
(nominal est)

0.67

Human Capital Index

96.8%

Adult Literacy Rate

53.44
(8th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

Data Privacy

  • There is no single, comprehensive, law addressing data privacy protection.
  • Foreign firms are understandably concerned by the ambiguities of the current data privacy regulatory regulations and lack thereof.
  • Though China asserts that they plan to pattern their yet to be created data privacy laws after Europe’s GDPR, no such rules are yet in place.

India

At A Glance

1.3 billion

2019 Population

$1.11 trillion

Gross Domestic Product
(nominal est)

0.53

Human Capital Index

96%

Adult Literacy Rate

50.06
(13th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

  • There are government initiatives in place that remove trade barriers in the services sector to drive growth and gain new markets in the outsourcing industry.
  • Many Indian business leaders believe that the government is not doing enough in terms of taking advantage of rapid technological advances to build a robust digital economy.
  • There is a commitment to prioritize policies and programs for the IT sector.

Data Privacy

  • There is no dedicated data protection legislation.
  • India repeatedly been the source of serious of data leaks and digital breaches for three consecutive years (2017, 2018, 2019).
  • The country is in the process of enacting into law a proposed Personal Data Protection Bill; however, no such protections are in place as of this writing.

Indonesia

At A Glance

270 million

2019 Population

$3.20 trillion

Gross Domestic Product
(nominal est)

0.44

Human Capital Index

74.4%

Adult Literacy Rate

55.49
(5th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

  • History of harsh working conditions and rigid labor laws have cast a negative light within the industry
  • Questionable outsourcing practices and regulations have caused many in the industry to think twice before investing here
  • Implemented a Manpower Law in 2019 in an attempt to simplify outsourcing requirements

Data Privacy

Malaysia

At A Glance

32 million

2019 Population

$365.30 billion

Gross Domestic Product
(nominal est)

0.62

Human Capital Index

95%

Adult Literacy Rate

55.85
(3rd in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

  • While there is government support to techno-preneurship and innovation, little attention is given to global business services (GBS).
  • Local companies within the outsourcing and shared services (OSS) industry in the process of consolidation to be at par with competition in the global market.
  • There are limited players and opportunities within the outsourcing industry but government is keen on strengthening its workforce to keep up with the demands.

Data Privacy

Nepal

At A Glance

28 million

2019 Population

$29.81 billion

Gross Domestic Product
(nominal est)

0.49

Human Capital Index

68%

Adult Literacy Rate

49.00
(14th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

  • 6,000 BPO companies
  • $653 million total stock of FDI (foreign direct investment)
  • The services sector (financial, consultancy services, IT and communication, foreign employment services, etc.) contributed to 51% of GDP for 2018

Government Response

Data Privacy

Philippines

At A Glance

108 million

2019 Population

$356.81 billion

Gross Domestic Product
(nominal est)

0.55

Human Capital Index

98%

Adult Literacy Rate

60.14
(2nd in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

Data Privacy

Singapore

At A Glance

5.8 million

2019 Population

$362.82 billion

Gross Domestic Product
(nominal est)

0.88

Human Capital Index

97%

Adult Literacy Rate

66.82
(1st in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

  • 98% of Singapore companies rely on outsourced IT infrastructure services
  • $829.7 million total revenues from BPO services
  • $1.9 billion worth of government-funded ICT contracts in 2020
  • $2.5 billion worth of government ICT expenditure to ramp up digitalization investment
  • 21,000 IT professionals have benefited from TechSkills Accelerator program to up-skill and re-skill themselves for various outsourcing work opportunities

Government Response

Data Privacy

  • Given its position as a regional financial hub in Asia, the city-state is a target of relentless cyber-attacks that have had a negative impact on its economic growth.
  • Data breach in big companies is attributed to careless handling and storage of sensitive information in local servers.
  • There is a call to make significant changes to its existing Personal Data Protection Act (PDPA) to keep pace with the evolving business landscape whilst strengthening data privacy in the digital economy.

Taiwan

At A Glance

23 million

2019 Population

$586.10 billion

Gross Domestic Product
(nominal est)

0.67

Human Capital Index

98%

Adult Literacy Rate

54.18
(7th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

  • $88.4 million production value of Taiwan’s IT service and software industry
  • $8 billion worth of FDI (foreign direct investment)
  • $73.56 billion revenue from the ICT sector which contributes to around 15 percent of Taiwan’s GDP

Government Response

Data Privacy

Thailand

At A Glance

69 million

2019 Population

$529.18 billion

Gross Domestic Product
(nominal est)

0.60

Human Capital Index

94%

Adult Literacy Rate

47.61
(17th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

  • There is commitment to become a leader in the IT outsourcing industry through its provision of superior business climate for foreign investors and through infrastructure improvements.
  • Skills shortages have become the biggest obstacle to workforce competitiveness.

Data Privacy

Vietnam

At A Glance

95 million

2019 Population

$261.64 billion

Gross Domestic Product
(nominal est)

0.67

Human Capital Index

95%

Adult Literacy Rate

51.57
(10th in Asia)

English Proficiency Index

Outsourcing Highlights

Outsourcing Market Size

Government Response

Data Privacy

Related Articles

Want to know the cost of outsourcing your business processes?