OBG talks to Juan Pablo Rivera, President, Bogotá Free Trade Zone

Interview: Juan Pablo Rivera

What effect has business process outsourcing (BPO) had on the development of free trade zones (FTZs)?

JUAN PABLO RIVERA: Some regions are shifting towards the development of BPO and knowledge process outsourcing (KPO) as part of their focus on economic growth. Bogotá Free Trade Zone (BFTZ) is about to start the construction of FZ Towers, a 110,000-sq-metre technology park with five towers that will be entirely oriented to the development of these sectors. Nearly 20 companies involved in outsourcing are already present in BFTZ, including global firms like Genpact, Synapsis and Telefonica, as well as local companies like Carvajal, and we expect several more to arrive.

This is also happening in other FTZs because BPO has had a large economic impact in investment and job creation. Over 10,000 people of the 22,000 currently working in the BFTZ are employed in the BPO sector. These jobs have been created only in the past five years, as investments for outsourcing have exceeded $100m. We are confident that the number of jobs and level of investments will continue to rise as companies providing outsourced services keep arriving.

What initiatives are helping train staff in the FTZs?

RIVERA: FTZs are working with universities and the National Service for Learning (SENA), a centre focused on boosting technical skills, to provide qualified human resources to their clients through partnerships. BFTZ is developing our own university and has a strategic alliance with SENA and six universities in Bogotá working in different programmes. We hope to have about 1000 people enrolled by July 2014. While one of the programmes is focused on bilingualism – in English as well as Portuguese – we already run a programme with the municipality of Fontibon (where the FTZ is located) under the name “Fontibon bilingual”, helping 200 people improve their second language skills.

SENA is also reviewing another project that would train between 300 and 500 people in second languages per year. It is essential to contribute to the training of human resources so industries that develop within FTZs can grow quickly and steadily.

How would you describe the advantages and disadvantages of clustering in FTZs?

RIVERA: FTZs tend to concentrate industries with the greatest potential for growth in each region. Zones in the eastern side of the country (the plains) are developing agribusiness and biodiesel clusters that are generating synergies and connectivity between them.

Atlantic coast FTZs are developing two clusters, one focused on heavy industries and another on logistics.

Bogotá, in the centre of the country, is developing lighter manufacturing, services and logistics clusters.

While logistics has been particularly strong within the BFTZ, with over 100 companies in the sector, we are now working on the development of value-added services, BPO and KPO, industries that will lead the region’s development in the medium term.

BFTZ has recently become known as “Fontibon Valley”, as hardware assembly (laptops, tablets and PCs) for domestic consumption and export is done here. Clustering has allowed the development of supplementary activities, including the establishment of universities within FTZs for specific training and the creation of internal job boards. We are beginning to witness synergies and business done between companies of the same sectors. There have been cases of data centres and BPO companies bidding jointly on public tenders or offering services together to private companies.

How connected are the 36 FTZs in the country?

RIVERA: FTZs are interconnected via the Free Zones Chamber within the National Business Association, through which we work on issues of common interest, including regulation, promotion and training programmes. Together with Proexport, FTZs promote their spaces in international events. In July 2013, we participated in a business conference in Argentina and at an investment forum in New York, just to name a couple.