Renewed opportunity

The world has changed a lot since September 15th 2008, when the subprime crisis gave rise to the global financial crisis. Now the impact of this crisis is being felt in the real economy in the form of unemployment, loss of income, and the economic slowdown.

Brazil is not an island in the global economy. It is now feeling the effects of the crisis, above all in industry, but nevertheless remains well-positioned. Especially in IT, the country?s opportunities to take up a leading position in the export of IT services, alongside India, have been renewed.

Brazil?s IT exports in 2008 are being recalculated by IDC ? hired by Brasscom and MCT to carry out a study ? and the as yet preliminary figures are surprising. We are better than we thought in this area. Exports are over US$ 1.3 billion, and even considering the effect of the devaluation of the Brazilian real, the chances of our achieving US$ 3.5 billion in 2010 are good.

Now, what needs to be done? Three things, basically:

First, all of Brazilian society, the government and the private sector, must be convinced that information and communications technologies (ICT) are the tools par excellence for competitiveness and increased productivity in modern societies, locally and globally. The use of these tools is crucial during both the ups and downs, including in the current turmoil on world markets.

Second, investments is still decidedly lacking in the supply of an IT-qualified workforce, especially with young people able to express themselves adequately in English. To achieve the target of expanding exports to US$ 3.5 billion in 2010, the market will require 45,000 new professionals with these skills. The current base of these professionals will be tripled in two years. Heavy investment in qualification will be needed.

Third, there needs to be a new adjustment in comparative costs internationally. With the sum of all the incentives in place, Brazil remains 50% more expensive than its leading competitors, above all because of the taxes that fall on labor costs. This margin needs to be reduced to somewhere between 30% to 40%, and much can be contributed to this end by States and municipalities, in addition to the Federal government.

Even with cost differences, the world and Brazilian companies know perfectly well that few nations have the drive and response capacity that Brazil has in IT. It an opportunity worth taking.

Antonio Gil
President of Brasscom