The paper will provide and economic impact analysis of the Business Process Outsourcing and Offshoring (BPO and O) policy in South Africa. The paper will evaluate the impact on the competitiveness of South Africa as possible BPO and O destination in view of the increased opportunities for e-businesses on the World Wide Web due to the expected decreased cost of bandwidth in South Africa.  The decrease in the cost of bandwidth is due to the Seacom cable being linked to South Africa. BPO and O have been identified as one of the key sectors that can act as a major creator of jobs in South Africa.  In the State of the Nation Address in 2007 President Mbeki indicated that the national government will intensify efforts to reduce to cost of telecommunications to promote the BPO and O strategy. The Accelerated and Shared Growth Initiative of South Africa (ASGISA) which aims to take South Africa to a growth rate of 6% per annum also highlighted BPO and O as one of the key sectors to achieve this target for economic growth