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    Back office operations in Barbados

     

     
     
    © International Trade Centre, International Trade Forum - Issue 1/2001 
     

    The Barbados Investment and Development Corporation (http://www.bidc.com)

    Barbados was one of the first sugar-based agrarian economies to diversify into the provision of back office operations. The Government's strategy to develop Barbados as an offshore financial centre started after research had been completed to establish the best way that Barbados could leverage its highly educated workforce of English mother tongue, its proximity to the United States and Canada, and its traditional links with the United Kingdom.

    Barbados developed an offshore industrial park with "intelligent" buildings: fully air-conditioned with low-level acoustic ceilings, back-up power sources, protection from variations in power levels, and ergonomic lighting for data processing operations.

    The Government also passed the Barbados International Business Companies Act in order to attract international investors. The act provides for a limit on income taxation of 2.5%, exemption on all other taxes and levies, exemption from import duties on production equipment, freedom from exchange controls on foreign exchange, and a 150% deduction on export-related research and development.

    The Barbados Investment and Development Corporation (http://www.bidc.com) was created in order to promote the country's IT services among potential foreign clients.

    In 1998, the number of employees in the back office operations sector fell from a high of 2,972 to 1,937. This was due to at least two factors. The success of the "informatics" sector contributed to a per-capita income rise, reducing the country's competitiveness in the low value-added data entry and processing market. In addition, a virtual monopoly on its domestic and international telecommunications infrastructure has also reduced competitiveness.

    To combat this downturn, Barbados has targeted higher-end activities such as software development to replace data processing. It also has targeted niche markets that require discretionary judgement of skilled workers, such as claims authorization and complaint resolution.

    The Barbados Government is upgrading its workforce by introducing changes in the education systems to ensure that, in the future, a pool of appropriately skilled workers will be available. The University of the West Indies, Cave Hill Campus, and the Barbados Community College have training programmes in informatics, and the Government has started a project, Edutech 2000, to ensure that every child in the primary and secondary school system has access to an Internet-connected computer.