Brazil has firmly established itself as a tech-savvy nation with the world’s second largest users of social networks and approximately 230 million smartphones in use.

Google, Uber, Accenture, SAP and Oracle and most major technology companies have a strong presence in Brazil and in 2017 Facebook established its first-ever innovation centre in São Paulo.

Nowadays scaling and growing a business requires making a serious investment in technology with strong evidence of this occurring in Brazil.

According to the Brazilian Association of Software Companies (ABES) and IDC Brazil was the world’s 9th largest market in terms of IT investment in 2018 with spend reaching US $47 billion.

Furthermore, it is estimated 60% of Brazilian businesses have invested in Internet of Things (IoT) technology.

The Brazilian government anticipates that by 2025 IoT projects will contribute US $132 billion to the economy across healthcare, manufacturing, smart cities and agriculture. Brazil is a popular technology outsourcing destination.

Brazil can offer IT and tech support services and currently has international clients in both Latin and North America.

IBM and HP have outsourced their services in the country for years. Cloud service providers are increasing their capacity in Brazil with Oracle, CenturyLink, and IBM announcing plans to expand their data centre footprint.

According to the Deloitte Global Chief Procurement Officer Survey 2019 respondents reported South American companies are more focused than their global peers on analytics, digital presence, and robotic process automation (RPA) as part of digital transformation efforts to deliver value and achieve their objectives. Brazil makes up approximately 40% of the technology market in South America.

Research and Market’s Brazil IT Outsourcing Report 2019 -2024 highlighted the Brazilian market for technology services had readjusted “to meet new demands since end-user companies require services that can provide high value add, can be quickly implemented, and are offered at more competitive prices.”

The range of technology services offered is extensive and comparable to other outsourcing destinations such as India and China.

Brazil has energy stability, reliable network connectivity, good infrastructure in major cities and no history of terrorist attacks. There is a large and experienced technology community with IT professionals having strong English-speaking capabilities which is required for servicing North American clients.

As a country receptive to new technology and innovation the Brazilian IT workforce is able to promptly respond to disruption. There are over 300 Agtech startups helping propel the nation to the second largest agricultural exporter in the world. Brazil has 1,714 IT-related technical and graduate courses producing more than 100,000 graduates per annum.

There are more than half a million software developers with Brazilian software development businesses supporting 65% of Fortune 500 companies. The average rate for a senior developer ranges from US $20 – $50 per hour.

According to a recent Thomson Reuters article on the Brazilian IT outsourcing market it has been possible to outsource core activities in Brazil since 2017.

There is an extensive range of statutes and laws relating to IT outsourcing in Brazil. Brazilian General Data Protection Act comes into force on August 2020 and contemplates the rules on the processing of personal data.

While Brazil may be an attractive option for Australian companies requiring or consider IT outsourcing it is important to perform extensive due diligence and obtain appropriate advice.

Cheers,

Martin Stark

IT Strategic Sourcing Leader

 

 

Sources:

https://www.zdnet.com/article/it-investments-in-brazil-surpass-world-average/

https://www.launchwaymedia.com/blog/brazil-latin-americas-technology-leader

https://www.tecla.io/blog/brazil-software-outsourcing-and-top-nearshore-development-talent-report/