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LatinAmerican Startup

Which Latin American country is doing the most to boost its IT sector?

IT is the future. This is not something I say. It is what it is. Boosting its IT industry should be a top priority for most countries globally. Not only more IT-related jobs could be created, but we would also need other types of professions to support the sector.

This is what I’ve been able to see in the region.

Mexico: Guadalajara (hueles a limpio, a rosa temprana) is becoming a tech hub in Mexico. Most technological companies are settling in this city which is the 2nd or 3rd biggest city in Mexico (disputing the place with Monterrey). Mexico (specifically Guadalajara in this case) offers a lot of advantages from low basic costs to the possibility of fast access to the US market. The main challenges of Mexico are a violent drug war and a lack of federal government support to boost the sector.

Argentina: When I started to work in IT I was shocked to learn that almost all the most important technological companies in the world have offices in Argentina. These companies prefer to settle in Argentina than other countries in the region like Uruguay, Chile, Paraguay or Brazil. It seems they prefer to settle there because of the amount of highly qualified professionals (take into account Argentinians are the best English speakers in Latin America). Government support seems to be OK and it could increase with the new president Fernández. The main disadvantage is the constant state of panic of the Argentinian economy.

Uruguay: A small country with only 3.5 million inhabitants where 2.5% of its GDP is produced by the IT sector is Uruguay. Government support seems to be high as they have a special tax regime and “free zones”. Professionals seem to be well qualified. However, for some reason, Uruguay hasn’t attracted all the IT companies in the region that prefer to settle in neighboring countries. The main disadvantage of Uruguay is their extremely high basic costs (electricity is the most expensive in South America).

Costa Rica: Another small country that the big ones should look at. Costa Rica attracted big players (Microsoft, Amazon, Intel, etc.) with its political stability and educated population that no other country in Central America has. Costa Ricans are one of the best English speakers in Latin America. However, Costa Rica needs to improve its infrastructure and finally put public finances in order to attract more companies and boost the sector.

I know Brazil and Colombia are also doing incredible things. Brazil has NuBank (the largest fintech in Latin America) and Colombia has a vibrant start-up scene but I don’t know much about it for now.

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