Biggest provider of outsourcing

China will become the world's biggest provider of software outsourcing, according to analysts at the China International Software Outsourcing Summit 2006 on Wednesday.
The analysts claimed that in a few years about five to 10 percent of US and European software outsourcing will be diverted from India to China.

Increased outsourcing contracts will boost mergers and acquisitions in China's software industry, so that enterprises can upgrade and win more deals, according to the analysts who were attending the summit in Shenzhen in south China's Guangdong Province.

A recent survey shows that in the mid-1990s, only 15 percent of China's software companies were under contract to foreign companies to provide outsourced software, but in 2005 the figure had climbed to 40 percent.

Outsourcing contracts with US-based companies doubled in 2005 over the previous year, while business with EU firms jumped 85.7 percent.

The global service outsourcing market is worth between US$300 billion and US$500 billion. Business insiders have predicted the market will reach US$1 trillion in 2008 with an annual growth of 7.9 percent.