Location Readiness Index

Location Readiness Index Jamaica

ABSTRACT Diagnostic study of the IT-based services industry in Jamaica conducted leveraging the Location Readiness Index (LRI)

Developed in collaboration with

LOCATION READINESS INDEX................................................................................................... 3 I. TALENT POOL INDEX.................................................................................................................... 6 II.

COST INDEX ............................................................................................................................. 9

III.

QUALITY OF INFRASTRUCTURE INDEX ......................................................................................... 11

IV. RISK PROFILE INDEX ................................................................................................................ 13 V. ENVIRONMENT INDEX .............................................................................................................. 15 VI. MATURITY OF INDUSTRY INDEX ................................................................................................. 18

LOCATION READINESS INDEX

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Location Readiness Index A quick diagnostic of the IT-based services industry in Jamaica has been conducted leveraging the Location Readiness Index (LRI) - a modeling tool developed by the World Bank in partnership with McKinsey & Co. designed to help countries identify existing gaps and weaknesses and allow policy makers to prioritize the areas that are more important for increasing the overall location attractiveness of a country. The figure below presents the six criteria evaluated for the LRI assessment, which are: (i) Talent Pool Availability; (ii) Cost Structure; (iii) Quality of Infrastructure; (iv) Key Risks; (v) Overall Environment; and (vi) Sector Maturity.

Figure: Location Readiness Index (LRI) framework

Talent Pool Market Maturity

Cost

Environment

Quality of Infrastructure Risk Profile


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The LRI scores are in the range of 1 to 5 and the figure below shows their interpretation: Figure: Interpreting LRI scores

•With a clear roadmap, country will be attractive over the next 1–2 years •Significant government intervention is required to change policies and attract the IT/ITES industries.

Significant

action needed •Either talent is not available or cost is not favorable. •Multiple other areas are not favorable •Significant actions are required to attract the industry

Not ready

5

Action needed

4

•Most of the criteria are favorable •Low level of additional preparation is required to attract the IT/ITES industries •Minimal policy intervention is required by the government •Investors will be ready to invest •Focus is on active outreach programs

3

•Country is ready to attract IT/ITES industries on all points

Favorable

2

1

Extremely favorable

•All areas need significant improvement: •No cost arbitrage •Talent not available • Perception of high-risk country •No availability of class A infrastructure •Unreliable telecommunic ations and communicatio n networks

The LRI assessment was conducted for Jamaica in comparison with Kenya – an emerging industry leader in Africa region, and Armenia – an emerging IT/ITES leader in Europe and Central Asia region, as a way to benchmark Jamaica’s position in terms of readiness as an outsourcing destination for IT-enabled services. United States of America were considered as the main potential outsourcing market for Jamaica. This preliminary analysis shows that Jamaica is a relatively competitive destination for an investor aiming to develop an off shoring IT-enabled industry. Jamaica shows relative competitiveness in terms of generalist talent pool, costs, and industry maturity, however, there is still a critical need to establish a competitive knowledge and IT processing talent pool, improve the quality of infrastructure and mitigate country risks, and further develop the business environment in order to become a truly hospitable offshore destination for IT/ITES. The figure below presents a comparison snapshot of the LRI scores along each of its six dimensions. Countries compared are: Jamaica, Kenya and Armenia.


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Figure: Jamaica comparison charts Generalists - Voice

Generalists - Data

Location Readiness Index


Industry Maturity

3.2 4.8

2.4

1.4 Environment

4.4 1.9

1.4

1.8

3.0

3.5

Cost

Environment

3.9

Cost 2.5

2.5 3.2

3.0

3.0 4.2

3.8 Risk

4.2

3.8 Risk

Infrastructure

Jamica LRI=2.32

Kenya LRI=3.18

Armenia LRI=3.12

Infrastructure

Jamica LRI=2.33

Kenya LRI=3.32

Knowledge Process

IT Services



Industry Maturity

3.4

3.5 4.9 4.8

3.2 4.2

Industry Maturity

Talent

3.4

3.5

5.0

Talent

4.6

4.2 2.8 2.2

1.5 3.0

1.4

2.5

3.0

2.0

3.5

Cost

Environment

3.9

2.7

1.8

3.5

Cost

2.5

2.5

3.2

3.2 3.0

3.0 4.2

3.8 Risk

Jamica LRI=3.33

Armenia LRI=3.18

3.2

2.8 2.2

Environment

2.0 1.9

3.5

3.2

3.9

4.9

2.4

2.8 2.2

2.1

3.0

Talent

3.2 4.2

3.9

2.8 2.2

3.9

3.3

Industry Maturity

Talent

3.1

4.2

Infrastructure

Kenya LRI=3.48

4.2

3.8

Armenia LRI=3.24

Risk

Jamica LRI=3.46

Infrastructure

Kenya LRI=3.41

Armenia LRI=3.18


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I.

Talent pool Index

Together with the existence of a competitive telecommunications market, the availability of a skilled talent pool is the single most important factor in the growth of an IT-based services industry. The talent pool assessment in the LRI diagnostic calculates the (i) Suitability, (ii) Willingness, (iii) Accessibility, and (iv) Trainability of university graduates in subjects that may be of interest to companies operating in the IT/ITES industry. Calculations were carried out for each of the four traditional IT/ITES business lines classified as following: Data Processing, Voice Processing, Knowledge Processing, and IT services. Based on the annual statistics from the Ministry of Education, Jamaica produces around 97.6 thousand high school and tertiary graduates who may be employed in the IT/ITES industry each year. Jamaica ranks the 85th for the Higher Education and Training pillar of the 2011-2012 Global Competitiveness Rankings published by the World Economic Forum. With a score of 3.9 out of 7, Jamaica scores higher than Kenya (94th) but lower than Armenia (76th). Nonetheless, the assessment suggests that compared with Kenya (3.89) and Armenia (4.79), Jamaica (2.70) shows a relative high proportion of graduates suitable for data processing. This is largely due to a relatively high number of high school and university graduates in a general discipline (around 90 thousand). Additionally, there is a high number of English speaking work force, as the official language in Jamaica is English. The talent pool index for voice services is assessed at 1.9, which is much higher compared to Kenya (4.36) and Armenia (4.88) for the generalists-voice group. However, Knowledge Processing (4.78) and IT Services (4.95) are two groups where Jamaica is scoring very poorly in terms of talent pool readiness. Jamaican tertiary institutions produce around 6 thousand graduates with degrees in business management and accounting that are of interest to the Knowledge Processing sector. To this group were added another 4 hundred graduates with degrees in arts and media that are of interest to creative industry as part of the Knowledge Processing sector. Nonetheless, even with relatively high percentage for suitability, accessibility, and willingness, the ready to hire population for Knowledge and IT groups are very small and score extremely poorly. The assessment suggests that out of 97.6 thousand graduates with potential to be employed in the IT/ITES sectors only 76 thousand are actually ready to be hired, and an additional 11 thousand could become suitable provided that they get a training of maximum six-month. The figure below shows how the ready to hire population was calculated for Jamaica.


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Figure: Jamaica’s Ready-to-Hire Population Graduate category

Total graduates (thousand)

Suitability (percent)

Accessibility (percent)

Willingness (percent)

Ready to hire (thousand)

Trainability (percent)

Potential Talent Pool (thousand)

Generalists Data

90

70 %

80

70

35.3

20

40.6

Generalists Voice

90

70

85

70

37.5

20

42.8

Knowledge Processors

6.4

80

80

65

2.6

15

2.8

IT Specialists

1.2

85

85

65

0.6

10

0.6

TOTAL

76

87

The Suitability, Accessibility, Willingness, and Trainability estimates are based on the insights from a focus group comprised of the JCS Governing Council members. The group integrated 12 experts with experiences in varying segments of the local ICT sectors. Participants used their on-the-ground knowledge of the industry to arrive at consensus on each of these estimates. Among their considerations were listed: a) The level of educational attainment of the profile of potential participants in the four broad categories; b) The physical and transportation environment and its impact on proximity for access; c) The source of potential catchment for talent for each of the four categories; d) The actual experiences with current call center operations; e) Their historical knowledge of data entry modes; f) In the absence of actual local implementations of KPO and IT Services, generating projections as to what would obtain within those domains. Estimates for call-centers (General-Voice) category were independently validated in parallel with the HEART/NTA agency that conducted some level of analysis in this sector for a limited geographic region last year.


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The table below compares Jamaica’s LRI scores for the talent pool size and quality with those of Kenya and Armenia in four different business lines.

General - Data I. Talent Pool Index Ready to be hired / Willingness Potential / Trainability

General - Voice

Knowledge Process

IT Services

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

2.70 2.2 1.7

3.89 4.0 3.7

4.79 4.8 4.7

1.90 2.0 1.6

4.36 4.5 4.0

4.88 4.9 4.8

4.78 4.8 4.8

4.79 4.8 4.7

4.90 4.9 4.9

4.95 5.0 5.0

4.61 4.6 4.6

4.96 5.0 5.0


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II.

Cost Index

The cost index calculation of the LRI is made up of two main components. The first component, Hourly Cost of Doing Business, takes into account the hourly cost per full time worker doing a particular job required to keep an IT-based services firm running. The second component measures the incentives offered by the government authorities to companies operating in the IT/ITES industry. The figure below shows Jamaica’s cost of operations expressed in Full Time Equivalent (FTE).

Figure: Jamaica Cost of Operations

US$/FTE/Hour Generalists – Data

Generalists – Voice

Knowledge Process

IT Services

Labor

7.57

10.06

15.09

17.80

Facilities

2.82

2.69

3.38

3.64

IT/Telecommunications

0.59

0.58

0.52

0.59

SG&A

1.22

1.48

2.11

2.45

TOTAL

$12.2

$14.8

$21.1

$24.5

As detailed in the figure above, the cost of operations has been broken into four categories: Labor, Facilities, IT/Telecommunications, and Selling, General, and Administrative (SG&A) expenses. Labor costs include not only the salaries for direct employees, but also salaries for management and support staff. Note that the comparative low cost of employment for engineers in the IT sector is due to their low support and management expenses. The cost analysis suggests that Jamaica has a competitive cost base, largely due to relatively low wages paid. According to the Jamaica Employers Federation’s 2011 Annual Salary and Benefits Survey of Technical, Professional, Supervisory and Clerical Employees, Volume II and salary data from JAMPRO (Jamaica Promotions Corporation), the salary range for fresh graduates who are of interest to the industry is around $520 up to $1,900 per month. Salaries for specialists employed in the IT services sector being at the highest end. Mid-managers are reported to earn a monthly salary between $1,000 and $3,265.


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For all the business lines the average labor cost in Jamaica is higher compared to Kenya (GD$2.91, GV-$4.3, KPO-$5.7, IT-$4.6) and Armenia (GD-$5.6, GV-$6.7, KPO-$8.1, IT-$4.7). However, the average rental price of $20 sqft/month for the highest-class office space is similar to Kenya’s ($20.16) and lower than Armenia’s ($23). FLOW, a major Jamaican broadband operator, is charging $490 per month for leased lines on island. This price is similar to what broadband operators are offering in Armenia, but nearly one ninth the $4,500/month price in Kenya. According to JAMPRO, the government of Jamaica is supporting the industry through a number of free trade zones such as IT Parks, as well as single entity free trade zones for individual companies, which does not necessarily have to be located in an IT Park. These zones offer large tax exemptions, no tariffs, reduced or no VAT, and tax benefits for expatriates for unlimited time. However, the government should direct its efforts even more on incentives and infrastructure support for business operating in this sphere, because poor government support can become a significant bottleneck in attracting foreign investments. The table below compares Jamaica’s LRI scores on the cost dimension for Fully Loaded Cost and Incentives with those of Kenya and Armenia for four different business lines.

General - Data II. Cost Index Fully loaded cost/FTE/hour Incentives

General - Voice

Knowledge Process

IT Services

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

Jamaica

Kenya

Armenia

1.79 1.2

1.38 1.0

1.77 1.0

1.99 1.5

1.38 1.0

1.86 1.1

2.46 2.1

1.46 1.1

2.04 1.4

2.71 2.4

1.44 1.1

1.78 1.0

3.5

2.5

4.0

3.5

2.5

4.0

3.5

2.5

4.0

3.5

2.5

4.0

LOCATION READINESS INDEX 10

III.

Quality of Infrastructure Index

The quality of infrastructure index was measured along four different categories, collecting a total of nine indicators to analyze the availability, quality and reliability of Jamaica’s telecommunication, real estate, power supply, and transportation infrastructure. The LRI analysis suggests that the quality of infrastructure in Jamaica is not at its highest and measures for improvement should be taken. The table and graph below show that overall Jamaica with a score of 3.03 performs better than Kenya (4.17), but worse than Armenia (2.53). Its national infrastructure has a long way to go to reach the readiness level of USA, which is a model country for infrastructure development.

III. Quality of Infrastructure Index Quality of telecom and network service Uptime of end-to-end network Mean Time to Restore (MTTR) EIU connectivity rating Real estate Total inventory of class A spaces Vacancy rate of the class A/B spaces Power Annual average power outage days Annual power demand as % of power supply Transportation Total road length/per capita Total rail length/per capita

Jamaica

Kenya

Armenia

3.03

4.17

2.53

1.0 1.0 4.0

4.0 3.0 4.0

1.0 2.0 4.0

5.0 2.0

5.0 5.0

5.0 1.0

3

5.0 1.0

5.0 1.0

1.0 1.0

1

4.0 5.0

5.0 5.0

5.0 5.0

5 4

4.2 3.0

2

2.5

0 Jamaica

Kenya

Armenia

Even though Jamaica still suffers from poor overall connectivity, shortage of good office space, large number of power outages, and inadequate transportation infrastructure, Jamaica’s network availability during the year (est. 99.99%), mean time to restore (MTTR) the network after an incident (est. 2 hours), electricity peak time shortage (est. 0%), and the vacancy rate of class A/B spaces (est. 15%) is very favorable. Spatial Innovision Limited reports that the total time in the calendar year that the network is available through the internet or the uptime of end-to-end network is estimated at 99.99% and on average it takes only 2 hours to restore the network after an incident. These translate into a very favorable LRI score of 1 in regards to the quality of telecom and network services readiness. However, Jamaica (3.41 out of 10) ranked 85th out of 152 countries on the ICT Development Index (IDI) in the 2011 Measuring the Information Society Report published by the International LOCATION READINESS INDEX 11

Telecommunication Union. This gives Jamaica a score of 4 in terms of Connectivity readiness in the LRI diagnostic. On the IDI Kenya and Armenia with a similar LRI score ranked the 115th and the 72nd, respectively. Even if Norma Breakenridge former President of the Land Economics and Valuation Society, estimates the total inventory of class A spaces at 3 million sqft (LRI score 5), its vacancy rate of 15% translates into a favorable LRI score of 2. With a 0% shortage during peak times, the electricity supply meets the demand, but Nation Master reports that the electricity grid needs to be upgraded to decrease the current number of 20 days of power outages per year. The transportation infrastructure requires attention, as well. The current road length of 22,121 Km (Central Intelligence Agency, The World Fact book) and the total railway of 370 km (Jamaica Railway Corporation) are not ready and require significant action from the government. In terms of infrastructure development, Jamaica scoring 3.7 out of 7 was ranked 79th (out of 142 countries) in the latest Global Competitiveness Report (2011-2012) published by the World Economic Forum, which in addition to communications and power supply infrastructure takes into account the readiness of transport such as quality of roads, railways, ports, and air transportation.


IV.

Risk Profile Index

The country risk component of the LRI model measures three areas: (i) regulatory risk transparency, stability, and predictability of a country’s regulatory environment; (ii) investment risk - country’s macroeconomic and currency stability and capital freedom; and (iii) data risk the adequacy of a country’s intellectual property and data protection. With an overall LRI risk score of 3.22, Jamaica’s overall risk is similar to Armenia’s, but better than Kenya’s (3.78).

IV. Risk Profile Index Regulatory risks Stability of law/regulation Transparency & fairness of legal system Bureaucracy Country investment risks Macroeconomic stability Currency fluctuation Capital freedom Data protection Protection of intellectual property

3.22

3.78

3.22

1.0 3.0 2.0

2.0 4.0 5.0

1.0 3.0 4.0

5.0 5.0 1.0

5.0 4.0 2.0

5.0 3.0 1.0

4.0

4.0

4.0

5 4 3

3.8 3.2

3.2

2 1 0 Jamaica

Kenya

Armenia

According to the latest report by the Heritage Foundation, the overall process for starting a business has been streamlined, but licensing requirements are burdensome and cost over twice the level of annual average income in Jamaica. The Jamaica’s economy does very well in terms of Regulatory Efficiency though - the Business Freedom being favorably scored at 84.7 points out of 100 in the 2012 Economic Freedom Index (Heritage Foundation). On the Transparency and Fairness of Legal System, Jamaica (3) doesn’t do so well. It scored only 4 points out 10 on the 2011 Business Extent of Disclosure Index (World Bank Development Indicators), which measures the extent to which investors are protected through disclosure of ownership and financial information, and 40 points out of 100 on the Property Rights Index (Heritage Foundation, Economic Freedom Index 2012). The Heritage Foundation reports that this low score is partially due to the fact that the judiciary lacks adequate resources, and trials can be delayed for years. Additionally, bureaucracy can cause significant delays in securing land titles and inadequate law enforcement and an inefficient legal framework weaken the security of property rights and the rule of law.


With regards to the regulatory risks, Jamaica (2) unlike Kenya (5) and Armenia (4) does well in terms of Bureaucracy. The Economist Intelligence Unit evaluated the quality of bureaucracy in Jamaica at 0.64 points out of 1 (World Bank, Worldwide Governance Indicators, Government Effectiveness). This score indicates that the bureaucratic climate in Jamaica is much better than in Kenya (0.0) and Armenia (0.25). On the Macroeconomic Stability, however, Jamaica does very poorly. The World Economic Forum assessed Jamaica’s Macroeconomic Environment at 2.6 points out of 7, which places Jamaica on the last position out of 142 countries ranked in the 2011-2012 Global Competitiveness Report on their Macroeconomic environment. The Heritage Foundation classified Jamaica as a “moderately free economy”. Jamaica’s 2012 score on the overall economic freedom is at 65.1 points out of 100, which makes its economy the 58th freest among 179 world economies and the 12th out of 29 countries in the South and Central America/Caribbean region. Kenya (57.5) and Armenia (68.8) ranks the 103rd and 39th, respectively. Thus, Jamaica (1) scores extremely favorable on the LRI curve with regards to capital freedom. The Heritage Foundation denotes that critical development challenges confronting the Jamaican economy include corruption and relatively high government spending. Public debt has surpassed 115 percent of GDP. Reducing the bloated public sector, following through on plans to divest loss-making state-owned enterprises, and enforcing expenditure restraint are all essential in order to meet fiscal targets. Undermining anti-corruption efforts, the judicial system remains inefficient and clogged with a significant backlog of cases. Nevertheless, Jamaica has taken steps to enhance regulatory efficiency and better integrate its economy into the global marketplace. The economy performs relatively well in investment freedom and business freedom. Procedures for conducting a business have become streamlined, and foreign investment is welcome in many sectors, although the investment regime needs more transparency to spur dynamic investment growth. Within the 2010–2011 Global Information Technology Report, the World Economic Forum ranked Jamaica’s Intellectual Property Protection on the 78th position out of 138 countries. The 3.2 points out of 7 are translated into an LRI score of 4. In the same report Kenya (2.9) and Armenia (2.7) scored worse along this dimension. The LRI assessment indicates that significant action is needed to increase data protection in all of the three countries. It is worthwhile to note that the country risk, as like infrastructure quality and business environment is not an absolute barrier to success, given the example of Philippines’ rapid growth in this sector despite its high risk ranking.


V.

Environment Index

The environment index of the LRI assessment measures the business and living environment in a country and includes four parts: (i) general government support of business, including bureaucratic burden and corruption; (ii) the overall business environment; (iii) quality of life, including desirability of location, disease burden, and crime; and (iv) accessibility to the main markets where services are expected to be delivered, including flight time and frequency. Jamaica’s LRI scores compared to Kenya’s and Armenia’s along these dimensions are presented in the table below.

V. Environment Index Government support Government policy towards foreign investment National government policy towards FI Labor laws Flexibility of labor laws for industry Bureaucratic burden Ease of bureaucratic burden Flexibility of regulation Duration (days) to start a business Corruption Level of corruption Business environment Rating of overall business environment Employment practices Compatibility of business ethics/culture Accessibility (name changed) Travel time Frequency Time difference Living environment Overall attractiveness of living environment Rating of quality of life HIV/ AIDS- adult prevalence rates Number of murders per capita Number of rapes per capita

Jamaica

Kenya

Armenia

3.20

3.76

2.87

1.0

3.0

2.0

4.0

4.0

3.0

4.0

4.0

4.0

1.0

2.0

1.0

4.0

5.0

5.0

5.0 2.0 2.0

5.0 2.0 4.0

3.0 2.0 2.0

3.0 5.0 1.0

5.0 5.0 4.0

4.0 5.0 3.0

2.0 4.0 5.0 5.0

3.0 5.0 5.0 1.0

3.0 4.0 3.0 1.0

Jamaica

Kenya

Armenia

Environment Index 5 4 3 2 1 0

3.9 3.2

Jamaica

3.0

Kenya

Armenia

As can be seen, Jamaica does not do very well in terms of business and living environment (3.45). Its overall score is better than Kenya’s (3.76), but worse than Armenia’s (2.87). Metrics such as bureaucracy, corruption, accessibility, quality of life and HIV/AIDS risks, determining among others the overall attractiveness of living environment, are hindering Jamaica’s prospects to become a thriving outsourcing market. The World Bank’s 2012 Doing Business report ranks Jamaica the 88th (out of 183 countries) on its easiness to run a business. For comparison, Kenya and Armenia ranks the 109th and 55th, respectively. Recent changes in the procedures and regulation to start a business and protect LOCATION READINESS INDEX 15

the investors, as well as deal insolvency mitigation have moved down the country by three positions from its previous year ranking (85th). The World Bank reports that it takes at least 7 days to start a business in Jamaica (Doing Business 2012 report). This time period is way below the average for countries in Latin America and Caribbean (54 days) and OECD countries (12 days). For additional comparison, in Kenya and Armenia it takes 33 and 8 days, respectively, to start a business. The Heritage Foundation remarks that Jamaica officially encourages foreign investment, but the investment regime lacks transparency and efficiency, which gives Jamaica a score of 85 points (out of 100) in terms of investment freedom (Economic Freedom Index 2012, Open Markets). Although the labor market remains underdeveloped and relatively constraining, restrictions on work hours are flexible, which scores Jamaica’s labor freedom at 69.6 points (out of 100)(The Heritage Foundation). The World Economic Forum ranked Jamaica’s Burden of Government Regulation on the 111th position out of 138 countries (The Global Information Technology Report 2010–2011). With a score of 2.7 out of 7, Jamaica does a little worse than Kenya (2.8) and Armenia (3.1). Transparency International’s 2010 Annual Report rated the Jamaica’s Corruption Perceptions Index at 3.3 (on a scale of 0 to 10 – very clean). This ranks Jamaica the 87th among 178 world countries and below Kenya (154th) and Armenia (123rd) in terms of corruption spread. With no direct non-stop flights and an average flight time of 7 hours from Los Angeles to Kingston, Jamaica becomes geographically remote for the West Coast of the USA. However, Jamaica is easily accessible from the East Cost. There are a few non-stop flights from New York (JFK) which on average take 4 hours to Kingston (KIN). In terms of compatibility of business ethics/culture, which is based on the Geert Hofstede Study, Jamaican culture is not much different than that of US scoring favorable on the LRI curve (2). The largest differences are along the Individualism versus Collectivism dimension (IDV), which measures the degree of interdependence a society maintains among its members, and along the Uncertainty Avoidance dimension (UAI), which expresses the degree to which members of a society feel uncomfortable with uncertainty and ambiguity. Jamaica with an IDV score of 39 points is considered a collectivistic society, versus US-91 points considered one of the most individualistic societies. On the UAI dimension, Jamaica scores 13 points versus US-46 points, and thus Jamaica is considered to have a low preference for avoiding uncertainty. The method applied to determine the Jamaican culture distance index was the Kogut & Singh formulation, which generates a normalized statistic by dividing each of the four physic distance dimensions (i.e. PDI, IDV, MAS, and UAI) by the variances to produce a standardized number. LOCATION READINESS INDEX 16

Health and safety also remain as concern for foreign investors. UNICEF estimated the adult HIV prevalence rate for Jamaica at an alarming rate of 1.7%. This rate is lower than in Kenya (6.3%), but much higher than in Armenia (0.1%). The United Nations Surveys on Crime Trends and the Operations of Criminal Justice Systems registered the homicide rate for Jamaica at 52.1 per 100,000 people. Additionally, based on the number of police-recorded offences, the United Nations Office on Drugs and Crime calculated the rape rate at the national level at 25.5 per 100,000 people. International Living, which ranks and rates the world’s best places to live, gave Jamaica in 2011 a score of 63 points out of 100. Compared to Kenya (53) and Armenia (55) the quality of life in Jamaica is rated higher.


VI.

Maturity of Industry Index

The maturity of industry index describes how well developed the country’s IT-based services industry already is, how many IT-based businesses are being done, and whether there is an active business association to coordinate private and public sector activity and promote the industry to investors. The LRI assessment indicates that Jamaica has already matured a good IT/ITES industry. The LRI Maturity of Industry scores for Jamaica in comparison with Kenya and Armenia are presented in the table below.

VI. Maturity of Industry Index Vendor Capability / Experience in providing offshoring services Employees in IT/ITES as % of total employees in non agri. Presence of Industry association (Yes/ No) IT/ITES GDP as % of total services GDP

2.20

4.20

2.80 5 4

3.0 1.0 1.0

5.0 1.0 5.0

4.0 1.0 1.0

4.2

3 2

2.8 2.2

1 0 Jamaica

Kenya

Armenia

Based on the estimates form the Labor Market Expert, Spatial Innovision Limited reports that 2.5% employees are working in the IT/ITES industry as part of the total employees in nonagriculture labor. This percentage is higher compared to both Kenya (0.59%) and Armenia (1.6%). From the 2011 Statistics on Computer and Related Services and Telecommunications (UNCTAD), Spatial Innovision Limited estimated that IT/ITES GDP represents a very high 6.3% of Jamaica’s total services GDP. In Armenia this percentage constitutes 5.4 and in Kenya it is estimated only at 0.15.
