Latin America Is Shaking Up The IT Nearshore Landscape 

Despite economic uncertainty and rising inflation, investment in next-generation technologies continues to be prioritized by companies. These investments offer an opportunity for businesses to jumpstart their processes towards new heights or launch something entirely novel, a testament to the pivotal role tech plays in nearshore growth. 

 
Gartner predicts a 5.1% growth in tech spending during 2023 compared to 2022, with Cloud technology predicted to lead the way and analytics and AI/ML continuing their strong presence within budgets. 

“Economic turbulence will change the context for technology investments, increasing spending in some areas and accelerating declines in others, but it is not projected to impact the overall level of enterprise technology spending materially. “ 

 
John-David Lovelock, Distinguished VP Analyst at Gartner 

 
For Nearshore, this represents a solid push on Next Gen technologies innovation and adaption. According to CBRE Research's 2021 source, the countries that stood out in this practice during 2019 and 2021 were China, the United States, Germany, Denmark, Canada, France, Taiwan, Malaysia, South Korea, and Sweden. 

Latin America's Attractiveness Continues to Grow 

As the nearshore industry develops, Latin America is emerging as one of the most promising regions to consider. The Inter-American Development Bank (IDB) predicts that nearshoring in Latin America and the Caribbean could lead to a staggering increase of up to US $78 billion in exports from the region. Therefore, the countries involved would be the primary beneficiaries of this endeavor. 

According to the Inter-American Development Bank, it is estimated that $78 billion of exports in goods and services will be unlocked due to increased regional cooperation. Mexico could benefit significantly from this amount, with an expected export increase of over $35 billion - 55% more than the total regional gain. Countries such as Brazil, Costa Rica, Argentina, Colombia, Chile, Dominican Republic, and Peru also maintain a potential export increase, strengthening the region collectively.  

Mexico: The USA leading Choice for Nearshore Outsourcing in Latin America  

Mexico has topped the list for several years and, as mentioned above, tops the economic forecasts mainly for the following reasons: 

• The T-MEC facilitates trade between Mexico, the United States, and Canada. 
• According to the official website of the Mexican Government, it has a network of 14 treaties with 50 countries on different continents. 
• Territorial proximity to the United States. 
• Privileged time zone. 
• Profitable costs. 
• Highly trained professionals with a good command of the English language. 

Countries such as Chile, Argentina, and Brazil have also been profitable options, especially for IT services. Nonetheless, distance and varying time zones pose a significant problem. For example, according to several studies, Costa Rica's attractiveness has become notable due to the adoption of western business practices, English proficiency, talented software developers, and an increase in the call center industry.

Is it The Correct Answer? 

Latin American countries have a fantastic chance to succeed, yet it is vital that companies and governments take the required steps in order to ensure this potential success. There are daunting challenges ahead, and paying attention to them will be essential for achieving greatness. Some of them are the following: 

• Ensuring sufficient supplies of clean, renewable energy is essential 
• Investing in infrastructure development should also be a priority to create economic growth and reduce poverty. 
• Reducing violence and upholding the rule of law 
• Establishing strong macroeconomic policies and political systems must remain at the forefront for lasting progress. 

Our Approach to Nearshore 

Volteo Digital is a Global Transformation company, and since its founding in 2013, it has firmly believed in the talent of the new generations, combining their enthusiasm and momentum with the experience and maturity of its leadership team.  

Personally, I always say: "We are a North American company with a strongly rooted Latin American spirit." This can be clearly seen through our presence in Mexico, where we have the largest Center of Excellence in Guadalajara. We leverage our wealth of experience to deliver customized consulting services, providing the best market practices for customers located in North America, Europe, and Latin America. At the same time, each year, we graduate generations of professionals proficient in using the most innovative platform: ServiceNow.