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*By Werter Padilha

It is always a great satisfaction for me to remember the period in which I participated as advisor on the Advisory Board that prepared the project-study “Internet of Things: an action plan for Brazil”, started in 2016 by MCTI and BNDES. I don't remember any work that was so well done and with so many active hands: hundreds of experts from Brazil and dozens of international ones, research centers, universities, representatives of the technical and employer classes of our society, parliamentarians, among others. The result culminated in the National Plan for the Internet of Things (PNIoT), Decree No. 9,854, of June 25, 2019, with the purpose of implementing and developing the Internet of Things in Brazil.

Health, Smart Cities, Industry and Rural were the 4 prioritized verticals. More recently, the Tourism vertical was also included in the PNIoT, due to the impact of the pandemic on tourist activities, the need to promote digital transformation in this area and the availability of smart destinations in the country.

Each of these verticals began to be treated in a “hands on” style in Câmaras 4.0, in Brasília. The Ministries of Health, Economy, Agriculture and Tourism began to touch on strategies, public policies, generate synergies and sources of funding to make the IoT happen in Brazil.

All Chambers, always with the participation of the MCTI in moderation, have been very relevant forums, because they provide the integration of academia, science and technology institutes (ICTs), entities that represent different economic sectors and other actors in the innovation scenario. and entrepreneurship. And not even the pandemic affected the conduct of the work of the chambers, as everyone remained engaged, even if meeting virtually.

The 4.0 Chambers of these PNIoT verticals have presented their results and action plans. It is a feedback process, since synergies have been created and action and investment plans have been generated and improved in these meetings. Of course, we would like the results to be more impressive in some cases, but I am a witness that, despite the obstacles, good and firm steps have been and will continue to be taken.

I reiterate that in the pandemic the incentives did not stop. BNDES, ABDI, Embrapii, Finep and Softex, just to name a few, implement different lines of investments and public notices for IoT projects.

Since January 1, 2021, Internet of Things (IoT) devices and machine-to-machine (M2M) communication systems have been exempt from paying Fistel, Contribution for the Promotion of Public Broadcasting (CFRP) and Condecine for the term of five years. In other words, it is vital that we take advantage of this incentive within its validity period.

Another good news was the new breath given to Padis (Program to Support Technological Development of the Semiconductor Industry). The scare was great, because its renewal took place, as they say, “at 40 minutes of the 2nd period”. What matters, however, is that Law 14,302/22 was enacted and extends Padis' incentives until 2026.

I would also like to highlight the “high-speed goal” represented by the success of the 5G Auction, which took place in November 2021, which will enable the “high-speed highway” through which the Internet of Things should take off. Looking forward to starting to see the first results already committed for 2022.

It is worth noting that we have the recent FINEP/MCTI public notice, which has just come out of the oven, and will select innovation projects in Artificial Intelligence (AI), developed by startups in the aforementioned verticals of the PNIoT. Altogether, they will be R$ 80 million in economic subsidy resources.

So, I say that Brazil is happening! For the second consecutive year, a record was recorded in the total amount invested in startups, through 779 transactions. According to a survey by the Distrito platform, Brazilian startups received a total of US$ 9.4 billion in investments in 2021, and this amount is 2.5 times greater than that invested in 2020, and the highest since the beginning of the study, in 2011 Brazil, which in 2018 had only one unicorn, currently has 16 of them, according to February 2022 data from StartupBase.

It is also important to highlight that in this scenario, several Venture Capitals were created in Brazil in the last 3 years, and are increasingly directing their investment theses towards innovation and disruptive technologies. As they say, “there is money on the table for good projects”!

As an example, I cite the initiative between BNDES and Qualcomm Ventures LLC, which contributed R$40 million each to the IoT Fund. In this project, Indicator Capital was selected as manager and the Indicator 2 IoT FIP Fund now has a raised value of R$ 240 million, focused on investments early stage, being the first specialized in Internet of Things (IoT) and Connectivity in Latin America.

We can say that the country has never had so many investments and funds betting on technological innovations based on AI, IoT, 5G, among others. This inflow of capital increases the chances of startups scaling and attracting more investment.

Is everything a “bed of roses”? No! But the fact is that problems will be present in any scenario! There were problems in the past and there are today. Therefore, it is necessary to put our resilience, perseverance, flexibility into the field. Let's join creativity, agility to innovate and traction in the recipe for success. Unfortunately, we are experiencing the conflict between Russia and Ukraine and its barbs also affect us; inflation is a critical point, as it has increased in Brazil and worldwide; and, specifically in the Brazilian conjuncture, there are just over 6 months left for our elections in 2022, a factor that tends to destabilize.

There is another key question, which is how Brazil will respond to the global chip crisis, which combines high demand and a shortage of devices, which leads to higher prices and long delivery times. The difficulty is global, but I believe that there are some alternatives for exercising our resilience with creativity. Padis' renovation was an excellent sign. On the other hand, the TCU suspended the process through which the federal government plans to close Ceitec, the only chip factory in the region.

In the midst of this imbroglio, another process took place in which Softex was the only one to present a proposal for the public call to enter into a Management Agreement whose object is research, development, technological extension, training of human resources and the generation and promotion of technology-based ventures in semiconductors, microelectronics and related areas. How will this happen? It is not yet known. Minister Marcos Pontes, from MCTI, declared during an event in Barcelona that the country will have a new semiconductor program. We look forward to these definitions being released soon.

In view of this situation, I hope that Brazil does not get lost in legal debates and that the opportunity to have some respectable position in this chessboard of the world semiconductor market passes by. After all, the world is hostage to Asian production, remembering that Taiwan and China account for around 70% of the chips that the world consumes and here is another geopolitical situation that demands our attention.

To end this analysis, despite the forecasts, Brazilian GDP grew by 4.6% in 2021 and surpassed the losses caused in 2020 as a result of Covid-19. Last year's growth was driven by industry and services. So, I say it's time to value our strengths: the capacity of our entrepreneurial talents, the quality of the ICTs, the size of the domestic market and the will to make it happen. We can overcome the challenges and build a promising future, a More Digital and Less Unequal Brazil, in which the IoT is certainly already one of the enablers of the positive transformations we aim for.

*Werter Padilha, CEO of Taggen and Board Member of ABES

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