Ryan said effective damage control among prospective and existing investors will be difficult for any future administration, and convincing many outside investors of ongoing Egyptian stability will be a tough task. Investors will be wary of rhetoric touting a country's political and economic stability in order to secure BPO and IT service investment.
"Following recent border violence in Mexico and the 2009 terror attacks in Mumbai, the events in Egypt are certain to make outsourcers and their clients much more risk-averse than any time in recent memory, and are likely to push many companies to choose the more secure, albeit costlier, option of keeping third-party work onshore," Ryan said.
According to respondents to Ovum's 2010 CRM outsourcing Business Trends survey, this sentiment is already present among Western enterprises. About two-thirds indicated no offshoring plans, and regardless of location, the Egyptian unrest will reduce the bar for enterprise risk tolerance for offshore delivery, according to the analyst.