Latin America has a Gross Domestic Product of US$7 trillion (S$9.5 trillion), which is more than twice that of ASEAN’s8. The huge and growing population of over 600 million people in the region are taking to e-commerce. This is set to grow Latin America’s e-commerce market from US$59 billion (S$80 billion) in 2017 to US$118 billion (S$159 billion) in 20219.
The artificial intelligence (AI) sector is growing fast, with AI technologies being used across consumer, enterprise, and government markets. The AI sector is projected to increase exponentially from US$95 million (S$128 million) in 2017 to US$2.1 billion (S$2.8 billion) in 202510.
If you want to enter the huge Latin American market, consider starting with Brazil, the largest and most tech-savvy market in the region.
Brazil is seen as the leading innovation and e-commerce hub in the region. However, the local digital market is just taking off and in-market solutions are lacking. If you are in the digital technology space, there are tremendous opportunities for you to seize first mover advantage to meet increasing demand for technological solutions in Brazil’s private sector.
There is demand for digital solutions in Brazil’s e-commerce, fintech and healthcare sectors. In the area of fintech, banks are seeking solutions (including AI) to improve their operational efficiency, as well as to provide the 60 million unbanked Brazilians with online/mobile banking, payment and remittance services. The healthcare industry is looking for ways to improve the efficiency of healthcare delivery and provide more affordable healthcare for patients.
By offering more cost-efficient, niche solutions that can meet the specialised needs of these different sectors, you are likely to have an edge over larger competitors. Singapore’s well-respected brand and reputation for data privacy and reliability will also stand you in good stead.
Find out why Benedict Koh, Enterprise Singapore’s Regional Director, São Paulo, thinks that Brazil is a market that Singapore tech companies have to consider right away, and what advice he has for companies looking to get a foot in the door.
8: World Bank
9: “Latin America Leads Worldwide E-Commerce Growth”, WorldPay, 20 October 2017
10: Statista, 2018
Brazil ranks tenth in the world for crude oil production and third in Latin America for natural gas reserves11.
In its 2018-2022 Business and Management Plan, state-linked petroleum giant Petrobras estimated US$74.6 billion (S$100.7 billion) worth of upcoming investments, 81% of which is earmarked for exploration and production.
Recent discovery of vast offshore and deepwater reserves, and the possibility of unconventional oil production will accelerate the growth in oil production. This prompted the Brazil government to relax its regulations for the oil industry in 2017, with the aim to encourage research and development, boost foreign investment, and lower business costs.
Several Singapore companies with the capabilities sought by Brazil’s exploration and production segment are operating in Brazil’s large-scale shipyards today. Players in the marine and offshore engineering industry can also look out for opportunities in rig-building, ship conversion, module fabrication, supply of offshore service vessels and subsea engineering.
11: Central Intelligence Agency World Factbook, 2017
Brazil launched the Programme for Partnerships and Investment (PPI) in 2016 to bridge the country’s huge gaps in infrastructure, improve access to utilities, and create new jobs. It also included plans to privatise sanitation and power assets.
The Brazil government expects US$12 billion (S$16.2 billion) of investments through the 34 projects auctioned under the PPI.12 This has opened up opportunities for Singapore companies in the following areas:
Airport – Brazil plans to invest US$3.5 billion (S$4.7 billion) into 270 regional airports. If your company deals with engineering services, you can tap possible opportunities in state and regional airport projects.
Port – Brazil’s ports are in need of investment to increase its capacity to meet growing demand. You can explore taking part in expansion projects for existing p/orts or investing in new ports in the country.
Bus and rapid transit systems – Cities such as São Paulo, Rio de Janeiro and Salvador are looking at expanding their bus and rapid transit systems. If your company has expertise and experience in developing large-scale electronics, urban transit and security systems, you can explore opportunities in this sector.
Water – You can consider investing in projects such as build-own-operate and build-operate-transfer, or by providing consulting services, equipment or water technology solutions.
E-government – Firms with expertise in e-government project consulting and feasibility studies will find demand from the Brazilian authorities at the federal, state and municipal levels. The local government is looking to e-services to facilitate infrastructure development and trade.
12: “Foresight – Brazil’s Pragmatic New Infrastructure Program”, KPMG, 27 September 2016
Agribusiness is one of Brazil’s largest economic sectors. It contributed 26% to Brazil’s Gross Domestic Product and accounted for 46% of exports in 201713.
Brazil is the world’s largest exporter of coffee, sugar, soybean, poultry, beef, tobacco and frozen concentrate orange juice. It is also a major producer of corn, pork and cotton. Over the next ten years, Brazil’s food supply will grow above the global average14.
One attractive investment opportunity is in the area of agriculture technology. There is demand for technological innovation to raise agriculture productivity sustainably, without damaging Brazil’s natural environment. Increasingly discerning consumers are also more conscious about food nutrition and sustainable food sources. You can explore playing a role in Brazil’s sustainable agribusiness by providing low-carbon production technologies.
13: “Agriculture Drives Brazilian Economic Growth”, BrazilGovNews, 4 Oct 2017
14: Agriculture Outlook Report, United Nations Food & Agriculture Organisation and the Organisation of Economic Cooperation and Development, 2017