*by Jorge Sukarie
The Brazilian Association of Software Companies – ABES recently released its annual study entitled “The Brazilian Software Market 20 21 – Panorama and Trends”, published since 2005, based on a survey by IDC, one of the leading consulting and intelligence companies in market focused on IT and Telecom.
The study presents detailed data on the Brazilian IT Market, compared with more than five dozen countries, also targets of the IDC survey, which allows an assessment to be made between them, based on the standardization for the US dollar, of investments in IT in the local currency of each of these countries.
Global IT investments in 2020, which consider spending on software, hardware and services, totaled US$ 2,395 billion, representing a growth of 2.5%. In Brazil, these investments totaled US$ 49.5 billion, an increase of 22.9% over the previous year. Historically, the growth rate of these investments in Brazil is close to twice the world average, but last year the growth rate was almost ten times higher than the world average.
Some factors can explain this high growth in Brazil, detached from the world average. Initially, we can mention the low investments in IT in recent years, impacted by the challenging economic scenario that the country has been going through since 2014. As another factor, we can mention the pandemic that brought a great opportunity for the IT Sector, if we can consider any point as positive at such a regrettable moment that humanity has been forced to go through these last 18 months. But the fact is that the need for social distance from the home office forced companies and people to invest in technology to allow people to work, study, do teleservice, teleconsultation, purchases, hire services, among other activities that needed to be made remotely. Investments in IT security projects, search for productivity, communication, cost reduction solutions, among others, which should be done in 2 to 3 years, needed to be done in 2 to 3 months.
The expectation of growth in IT investments in Brazil for 2021 is still quite positive, considering this window of opportunity that the country is experiencing. The IT market is expected to grow around 11% against an average world growth forecast of 4.3%, returning Brazil to growth around twice the world average growth rate.
Last year's result allowed Brazil to return to the 9th position in the ranking of countries with the highest volume of IT investments in the world. In Latin America, Brazil, which has always occupied the first position among all countries in terms of the volume of IT investments, last year increased its share of investments in the region, which represented 44% of the total.
Investments in Cloud, IoT, Artificial Intelligence, BI, IT Security, 5G, Connectivity, among many other exponent technologies, will guarantee great opportunities for companies willing to explore this market in the coming months.
One of the factors that has limited Brazil's competitiveness is its low productivity. And one of the most efficient ways to gain productivity comes from investments in technology, in innovation, and this is a great opportunity for the Software Market for the coming years, especially in Brazil, as explained above.
The use of new technologies and their impact in Brazil, which are the subject of the ABES study, give a little insight into the opportunities that open up to software companies in a country that is at an important moment of economic recovery. The important thing is for companies to be attentive to follow this evolution and identify opportunities based on their expertise and knowledge so as not to miss this important window of opportunity that we will have ahead of us. The publication of its annual study on the Brazilian Software Market is one of the services that ABES offers its members as a way to bring as much information as possible to ensure that these companies have the opportunity to surf this wave of growth that we will have in the coming years.
*Jorge Sukarie, founding partner and president of Brasoftware and vice president of the board of ABES
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