IT Industry in Brazil

Brazil Demographics

Frontiers reaching 10 countries50% of South America surface More than 8 million Km2

50% of South American Population184 million inhabitants

50% of South American GDP US$ 1,3 trillion in 2007 8th larger in the world (PPP*)

Suriname

VenezuelaGuiana

Bolivia

Chile

Brazil

ParaguayArgentina

French Guiana

Brazil

Uruguay

Paraguay

EcuadorColombia

Peru

Facts and figures:

*Purchase Power Parity

Australia

Canada

Spain

South Corea

Italy

United Kingdom

Holland

GermanyFrance

India

Mexico

Japan

Nigeria

Pakistan

Bangladesh

Indonesia

Russia

USABrazil

China

AreaAreaover 4 million km²over 4 million km²

PopulationPopulationover 100 millionover 100 million

Countries w/ GDP*Countries w/ GDP*> 500 US$ Billions> 500 US$ Billions

Brazil

*Nominal GDP

Brazil Facts

67 Airports and 75 million people transported per year31.000 Km railways (11th in the world considering transported cargo)1.7 million km of roads (3rd in the world)54 Ports

Largest transports infra-structure among BRICs

External Sector: Rising Commercial Surpluses

-20,0

0,0

20,0

40,0

60,0

80,0

100,0

120,0

140,0

160,0

180,0

Exports US$ FOB Billion Imports US$ FOB Billion Balance of Trade US$ FOB Billion

Balance of Trade grew 25,0% per year from

2002 to 2007

Exports Brazilian Record: US$ 150 Bilion in jan-sep 2008

Source: Ministry of Development, Industry and External Commerce (MDIC). / Apex-Brasil.

Innovative and Technological EnvironmentInvestments in education

Stimulation to scientific and technological innovation

350.000 professionals distributed among 55.000 software, 350.000 professionals distributed among 55.000 software, hardware and IT services companieshardware and IT services companies60.000 college-educated IT professionals enter the job market 60.000 college-educated IT professionals enter the job market every yearevery yearInvestments in trainning and technical

education

Brazil's IT - Large Scale environment

• 59 millions internet users (30% of the population)

• In 2007, more of the 2.000 public services were already offered through the Internet (1.000 government Web pages)

• Telecom exponential growth

Million 1995 2000 2004 2007

Fixos 13,3 30,9 39,6 39,3Celulares 1,4 23,2 65,6 121TVA 1 3,4 3,9 5,3Banda Larga 0,2 2,3 7,7Total 15,7 57,7 111,4 173,3

MobilesMobiles

Cable TVCable TV

BroadbandBroadband

FixedFixed

Brazilian attitude and well-beingBrazil´s characteristics

Respect to democratic institutions and to international lawsPeace promotion – Brazil has historically friendly, peaceful relations with all its 10 neighbours

FlexibilitySense of humorAffectivityHospitality

Brazilian people´s characteristics

FRIENDSHIP

SOFTEX• Non-profit organization

• Around 1,500 software companies associated

• Integrates government, academia and private companies efforts to support software and services competitiveness

• Focus on business generation, software quality, industry information and support to government policies

• 21 Offices, 13 States

J. de ForaJ. de ForaR. de JaneiroR. de JaneiroCampinaCampina

ssCuritibCuritibaa

LondrinaLondrina

JoinvilleJoinville

S. PauloS. Paulo

FortalezFortalezaaC. GrandeC. GrandeRecifRecifee

BrasíliaBrasília

SalvadorSalvador

VitóriaVitóriaB. HorizonteB. Horizonte

S. CarlosS. Carlos

BlumenaBlumenauu FlorianópolisFlorianópolis

P. AlegreP. Alegre

MaringMaringáá

PetrópolisPetrópolis

BeléBelémm

Why is Brazil Competitive?Why is Brazil Competitive?

Software solutions and IT servicesBrazil’s competitive advantages - Sustainability

Brazil economic background(before 1994)

Qualified demand Multi cultural country

14

Software solutions and IT servicesBrazil’s competitive advantages

Impact on productivityImpact on productivity and costand cost reductionreduction

Creativity + efficientvisualization and

implementation of solutions

olho

Experience in developing complex

projects Quick understanding

of business rules

Software solutions and IT servicesBrazil’s competitive advantages - Sustainability

Brazil economic background(before 1994)

Constant economic instability and Constant economic instability and changes established a solid DNA changes established a solid DNA for:for:– Fast understandingFast understanding– Creative solutionsCreative solutions– Efficient process implementationsEfficient process implementations– Technology constantly updatedTechnology constantly updated

Current global IT environment Current global IT environment reflects same conditions with reflects same conditions with shorter innovation cycles shorter innovation cycles

Software solutions and IT servicesBrazil’s competitive advantages - Sustainability

• The most representative multinationals are present in Brazil

Qualified demand

Software solutions and IT servicesBrazil’s competitive advantages - Sustainability

Multi cultural country

Easy understanding and adaptation to any cultureEasy understanding and adaptation to any culture

Vision• If you are looking for software solutions If you are looking for software solutions

and IT services...and IT services...

...will find in Brazil a source of world class suppliers...will find in Brazil a source of world class suppliers

Few words about brazilian Few words about brazilian software and servicessoftware and services

Brazil IT environment• 98% of Income Tax filled through the Web

Source: TSE [Supreme Electoral Court] Final Reports, 2004Source: TSE [Supreme Electoral Court] Final Reports, 2004

“Survey findings indicate that government is seen as a more important driver of e-commerce in Brazil than in the rest of the world. For example, the Brazilian government influences internet diffusion by requiring taxpayers to use online services”Prof. Nick von Tunzelmann SPRU, University of Sussex, UK

Brazil IT environmentBanking

• The Brazilian banking system is a worldwide reference in terms of technology and uses

• SPB – Sistema Brasileiro de Pagamentos (Brazilian Payment System)– On-line transfer of funds among any financial institution anywhere in the country – Security and reliability: reduction of risk of

irreversible credit of payments

• 88% of 30 billion bank transactions are made automatically (ATM, phone, fixed and mobile, Web...)

• all checks are cleared within 24 or 48 hours

• all bank tranfers over US$ 2.000 are done in real time

Source: Banco Central do Brasil (Central Bank of Brazil)Source: Banco Central do Brasil (Central Bank of Brazil)

Brazil IT environmentElections• General elections for president, governors, senators,

and legislators in 2006

– Carried out in electronic ballot boxes specially designed (HW and SW)

– Total number of voters: 125 million throughout 5,657 cities (22,693 candidates running for 1,626 vacancies)

– Period of time to count the ballots: few hours

– Solution tested by Paraguay, Mexico, Argentina, Uruguay

Source: TSE [Supreme Electora Court] Final Reports, 2007Source: TSE [Supreme Electora Court] Final Reports, 2007

Brazil IT environmentE-Government

• 1,700 services available on the Internet

• 26,000 links installed

• 35 million pages accessed per month

• 6,000 auctions made

• www.redegoverno.br is the government portal: around

200 thousand unique visitors by months

• Car licenses annual renewal through ATMs

• Almost 13% of Brazil’s population utilized some sort of

e-Gov service in the last 12 months

Brazil IT environmentDigital Inclusion -

Brazilian Population (2006): ~ 187 millionsNumber of households: ~ 54 millions

• Internet users: 23 %• Households with computers: 22 %• Computers connected to internet: 17 %• Households with broadband: 40 %

Source: IBGE/PNAD - 2005Source: IBGE/PNAD - 2005

Software solutions and IT services overview Export volume and growth

20012001 20042004

US$ 100 US$ 100 millionmillion

US$ 315 US$ 315 millionmillion

20082008

US$ 800 US$ 800 millionmillion

20072007

US$ 2,2 US$ 2,2 billionbillion

Positioning considers:• Industry and business knowledge

• Qualified human resources

• Sound infraestructure

• Governmental support

• Political and legal environment

• Cultural compatibility

• Time zone proximity

What do we want?

• Increase our presence in the IT outsourcing market in France

• Partnership among Brazilian and French companies in order to provide software solutions and IT services in the European countries

• Investments of French companies and investors in Brazilian companies

Areas of ExpertiseVerticals

Telecommunications Agribusiness Applications

IT SecurityFinancial Services E-Government

Education & e-Learning

E-CommerceE-Commerce Airline Airline OperationsOperations

Electric PowerElectric Power

2.378.279HealthcareHealthcare

Areas of ExpertiseVerticals

Thank you!Thank you!

Glaucia Critter ChiliattoGlaucia Critter ChiliattoSOFTEXSOFTEXglaucia@nac.softex.brglaucia@nac.softex.br