YOU ARE AT:AmericasBrazil announces $248M investment to boost software, IT services

Brazil announces $248M investment to boost software, IT services

The Brazilian government has great ambitions for its information technology (IT) sector. Yesterday, the government unveiled a vast investment program totaling U.S.$247.65 million (R$500 million) over the 2012-2015 period, which aims to improve and increase software development, boosting both the software and IT service businesses in Brazil.

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Dubbed TI Maior (IT Major in English), the strategic program for software and IT services was unveiled by the Ministry of Science, Technology and Innovation (MCTI) with the objective of encouraging competition in the industry. (Read the whole plan here—in Portuguese)

The program is structured around five pillars: economic and social development; international positioning; innovation and entrepreneurship; scientific and technological production; and competitiveness. The funds will be subsidized by the Financier of Studies and Projects (FINEP/MCTI) and the National Council of Technological and Scientific Development (CNPq/MCTI).

TI Maior includes accelerating technology-based companies; consolidating digital ecosystems; instituting a government procurement  preference for purchasing domestically developed software technology; training young people to work in the IT field and attracting global research centers.

The minister of science, technology and innovation, Marco Antonio Raupp, said the government wants to increase software production in Brazil significantly so this growth can create revenue for the country, generating income for businesses and providing skilled jobs for Brazilians.

Brazil’s numbers
Excluding telecommunications, last year Brazilian IT sector revenue increased 11.3% over the previous year and exceeded U.S.$100 billion, representing 4.4% of Brazil’s GDP. The Brazilian Association of Information Technology and Communication (Brasscom) forecasts that by 2020 the Brazilian IT market will reach a total of U.S.$200 billion, with 10% related to exports.

Last year, during the Brasscom Global IT Forum, the association released an estimate predicting that Brazil’s information and communications technology (ICT) market could reach U.S.$300 billion to $400 billion by 2022. This would help Brazil climb to fifth place among the world’s most powerful economies in 10 years.

Achieving these goals will not be easy. There is a shortage of IT professionals in the country (read: Brazil will be short 750,000 IT professionals), and many entrepreneurs complain about high taxes and high costs which make it hard to compete in the international market.

The government stated that one of the main drivers of the announced program will be encouraging start-ups because they help accelerate research and development in software and services. Start-ups will be assisted by a structured network of mentors and investors, research institutes and incubators, partnerships with universities and large national and international companies, as well as market access programs and procurement.

Strategic sectors
The TI Maior program has 12 defined strategy sectors for which highly complex software and solutions will be developed. The sectors are education; defense and cyber security; healthcare; oil and gas; energy; aerospace/aeronautics; major sporting events; agriculture and environment; finance; telecommunications; mining; and strategic technologies (cloud computing, Internet, digital gaming, high performance computing and open source software).

In all cases, the program will stimulate project designs in research institutes, both public and private, as well as the formation of academic networks and business ecosystems.

The currency exchange rate at time of story: U.S.$1 = R$2.019

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