The sector has maintained constant growth over the last few years, reaching, according to reports from the Permanent Observatory of the Software and IT Services Industry (OPSSI – CESSI initiative) a total annual turnover of almost $4 billion. Even with the pandemic, their own technological needs arose to withstand the effects of isolation and remote work. Subsequently, it continues its path of growth but with different realities in the large groups that make it up and the particular situation of each one of them.
On the one hand, the large local or multinational companies and those that only carry out activities abroad that, making use of the excellent level of local professionals, have been expanding their offer of services or products, taking advantage of the effects of the exchange difference. They are the ones that have grown the most and, therefore, benefited.
At the other extreme, with a very different reality, are those companies that maintain activities locally or only for local clients (of any size), who are the ones who suffer to a great extent from the high inflationary impacts both on the part of their clients (materialized in the difficulty of achieving consistent adjustments in their rates) as well as the resources that constitute their base (demanding permanent improvements in wages and benefits, which are very complex to sustain), further reducing their already eroded margins. In the middle there is also a strip that, depending on its situation, can swing towards one or another group.
What are the economic measures that put the sector at risk?
Fiscal, exchange and economic stability are key to any business development. The large number of changes, to the “trial and error” method, that have been taking place do not allow clear rules of the game to be established. At the time, the creation of retentions to those exporting companies was a factor that clouded the growth of the sector to foreign markets, today are the restrictions on foreign exchange that inhibit the possibilities of making payments abroad through conventional channels, added to the changes that constantly occur in matter. These new obstacles can lead to the complete disappearance of existing businesses, operations and companies, simply because they are not part of an adequate long-term plan for growth and economic stability. In addition to this, there are the persistent measures that impact the sector; for instance the impact of the lack of agreements to avoid double taxation in the expansion of business in the international orderthe difficulty in obtaining sustainable productive financing for service companies, the high burden and tax pressure in our country, among other factors.
The recent blockade of access to the conventional foreign exchange market for the payment of operating obligations abroad will lead many companies to fail to fulfill their obligations to their suppliers, to their possible disappearance, to the “disconnection” of the country with technological advances, to the impossibility of leveraging new business opportunities with the inclusion of local services, and in the “best” of cases, the marked increase in the cost of any service, license or product that comes from abroad.
If the pandemic and remote work opened up new professional opportunities, the huge gap between the existing exchange rates also generates highly negative internal competition in the labor market from which the sector is nourished, where professionals struggle to develop activities directly with abroad, thus generating a “grey” economy where the entire ecosystem is harmed. And this, together with the previous negative aspects, returns to the starting point, regarding the lack of a macroeconomic plan that allows clarifying and establishing long-term rules, which would also boost investment in this and many other sectors.
Even so, the expectation towards the future is always positive, since technological growth does not wait for a country and even less for a company. The issue is not to lose the opportunities that the world presents, or not to generate more obstacles than those that the globalized economy itself imposes. If the conditions that are recreated at the government level are no longer adverse, growth will continue to be a natural factor.
General Manager Liveware IS
Source: Ambito
