Without direct flights to the US, can the IT sector thrive?

Without direct flights to the US, can the IT sector thrive?

American Airlines completed his last trip between Montevideo and Miami last March 25, and Uruguay ran out of direct flights to USA, while the information technology (IT) industry continues to demand improvements in air connectivity that will allow the country’s technological capacity to be further deployed in the world.

The suspension of direct flights It is not a surprise: when the airline resumed the route between the two cities in November, it was clarified that it would only do so for the high season in Uruguay, until the last days of March. In fact, it came from a seven-month hiatus due to the low season, and that is what, unless circumstances change, will happen from now on.

Beyond being a blow to the country’s connectivity, it is also a blow to a sector that depends on its ability to travel with relative ease to scale its businesses and continue developing the industry: the IT sector.

For entrepreneurs, connectivity is a key logistical aspect for exporters of goods and technology companies, since the lack of flights between countries is a disadvantage both for those seeking to scale from the country to the world, and for those seeking to develop a innovation hub in Uruguayan territory.

However, Uruguay is left without direct flights with the United States, after five months and despite the multiple negotiations that the government maintained in this regard. According to the latest official figures, the country has barely 70% of the weekly frequencies that were operating prior to the pandemic of Covid-19, even with the possibility of a private airline operating as a flag carrier.

What opportunities does the IT sector have in this context?

The truth is that the IT sector is one of the most prosperous in terms of service exports, and the United States plays a fundamental role in this.

In 2022, foreign sales of the software and Information Technology (IT) sector totaled 1,006 million dollars, according to the Uruguayan Chamber of Information Technologies (CUTI) in its Annual Survey. The figure implies an increase of 12% compared to the previous year and constitutes a historical record, resuming the trend of expansion in the sector.

In this scenario, the United States remained as main destination of exports of the Uruguayan technology sectorcapturing a 59% of total exports. In this data lies the importance that businessmen in the field give to direct flights with the North American country.

At the moment, for the IT sector there are no major changes: the suspension of the American Airlines route was expected and happens every year. So this should not have an immediately negative impact on the development of the sector. What does happen is that the potentialities that the item has cannot be exploited to the maximum, as indicated by the referents of the area.

Meanwhile, the government continues working to incorporate more routes between the two countries. The most recent are those of Copa Airlines to the US cities of Austin (Texas) and Baltimore, Maryland which will start operating at the end of June and beginning of July of this year; already NY through Argentinian airlines, with direct flight between Carrasco Airport and the one of Ezeiza. However, all three trips are with layovers.

Source: Ambito

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