How Bolivia is Becoming a Nearshore Outsourcing Tech Hub Worth Noticing

10/16/19
By
Jimena Baliero

Countries today need a strong digital foundation to affirm their global competitiveness, increase their Gross Domestic Product (GDP), promote innovation, and create new jobs.

While once slow to join the digital trend, Bolivia has experienced outstanding growth in the last few years in science and technology, becoming an increasingly important tech hub in its region.

Bolivian authorities view its technological growth as having been a key stepping stone for the country on the path to social and economic growth. Recently, Bolivia has prioritized investing in initiatives that advance overall welfare. According to recent official statistics, in the last 12 years, Bolivia has:

  • Reduced poverty levels by half, from 38.2% to 16.8%.
  • Reduced inequality. The income share of the top 10% was 128 times higher than the poorest 10% portion of the country in 2006 and since then, the number that has decreased to 37 times higher.
  • Increased the country’s GDP by 5%.
  • Reduced illiteracy by more than 10%.

 

Connectivity

Bolivia has also seen major improvement in national connectivity. The National Telecommunications Company, Entel, has already installed almost 12,000 miles of fiber optics in the country, with a plan to reach the entire territory by mid 2019.

In addition, mobile connectivity has increased by 68% and by May 2019, the company plans to have completed its submarine fiber optics installation, achieving complete independence and lower data costs for the Bolivian population. This year, Entel also plans to adopt new technologies such as mobile wallet and 5G, as well as two major cloud computing systems to store national data without having to send it abroad.

Technological Advances & Investment

In the last few years, Bolivia has striven to become a hub for the technology industry in the region by investing heavily in both local companies and in STEM education. Some of these efforts include:

Tech Hubs

Through institutions such as Bolivia Tech Hub and Hub Santa Cruz, the country is increasing access to education and business opportunities in science and technology. They have begun hosting incubators and accelerators for entrepreneurs, as well as providing spaces for young people to develop their skills and learn about trends in the industry such as artificial intelligence.

6B Labs, located in Santa Cruz, is another key part of the local entrepreneurial growth. It’s an innovative incubator providing Bolivian entrepreneurs with the opportunity to start up global fintech, crypto, blockchain, e-commerce, mobile apps or Saas companies in just three months.

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Credit: Bolivia Tech Hub

Software Development

According to the Electronic Government and Information and Communication Technologies Agency (AGETIC), the city of Cochabamba is the biggest software developer and services exporter in the country (80% of programs are developed there), followed by La Paz and Santa Cruz.

Nowadays, more than 200 software development companies export over 50 million dollars in software annually, mainly to the United States, but also to the Netherlands, Belgium, Czech Republic and Panama, among others. According to the Bolivian Chamber of Information Technologies (CBTI, in Spanish), under the right conditions, the IT industry can represent over 6% of the country’s GDP (approx. $2 billion).

According to the 2019 Stack Overflow Developer Survey, Bolivia has almost 11,000 developers, many of which are working for local companies. The number of independent software developers that currently operate from Bolivia and outsource their skills to other countries has also grown considerably in the last few years.

Bolivian (and South American) software development services have become extremely popular particularly in the US, because the country shares similar time zones as the continental U.S., simplifying transactions and delivery dates, combined with the quality of service and cheaper labor costs. Furthermore, according to the 2019 World Bank Doing Business report, the export process in Bolivia is one of the quickest and cheapest in the region, which makes it an attractive option for  companies looking to purchase software developed in Latin America.

Digital Investments

For the past three years, Bolivia has hosted Digital Bank, one of the most important advanced technology events in Latin America, where some of the most innovative solutions in mobile payments, e-wallets and financial inclusion are discussed.

When it comes to billing, 83% of the more than 400 million bills issued in the country are processed electronically, and this number is expected to reach 100% this year.

In terms of investment, Bolivia has increased its financial digital investment by 3% between 2017 and 2018 (from 8.67% to 11.67%), becoming the third Latin American country with the highest investment rates in this industry, preceded only by Panama and Argentina.

Bolivia’s Hottest Technopoles

Photo: Cochabamba, Bolivia

  • La Paz (1.9 million inhabitants): Bolivia’s capital is considered the main technological city in the country. It has the most modern infrastructure, with more than 60 miles of fiber optics lines that connect 60 of the city’s main municipalities. It is also home to one of the most important software development companies in the country, Coderoad-Mojix.
  • Santa Cruz (2.1 million inhabitants): Santa Cruz is the most populated city as well as the city with the largest economic growth in Bolivia. Home to more than 20 universities, both private and public, as well as to several software development companies and local and international conferences, Santa Cruz has embraced the technological revolution.
  • Cochabamba (1.75 million inhabitants): Bolivia’s crown jewel, Cochabamba is responsible for 80% of the local software development as well as the home of the most important software development company in the country, Jalasoft.

Education

Despite having more than 11 million inhabitants, Bolivia is currently the second Latin American country with the highest investment rates in education. The government has invested over 1.8 million dollars to develop science and technology education in the country, which has created nearly 130 new tech institutions in the past 11 years, equipped with cutting-edge technology, and spread throughout the country.

As stated by Hortensia Jiménez, the director of the Bolivian Nuclear Energy Agency, (ABEN) to local news website, Prensa Latina, the government is working towards achieving scientific and technological autonomy, because ultimately, “knowledge is freedom.”

According to Bolivia’s 2025 Agenda, the country plans to expand innovation, knowledge and technology in strategic product and service areas to complement modern science with their traditional skills, social and professional creativity, and technical and technological wealth.

A growing number of Bolivian students are demonstrating interest in software development and technological innovations in the field of information and communications. Robotics has also become an area especially attractive for young people who organize hackathons, participate in science clubs and are constantly exploring the world of apps.

Local Universities with IT and Graduate Degrees

Nowadays, 36 private universities, 11 public universities, three indigenous universities and three universities with special teaching regulations offer IT degrees and masters programs in the country.

Bolivia has a solid infrastructure and an excellent university system that offers a wide array of majors related to computer science and IT. In Santa Cruz, at least one third of college students currently study engineering (out of 30,000 students overall). In the city, nine universities offer 35 different degrees in Engineering, 11 of which are offered by the Universidad Autónoma Gabriel René Moreno (UAGRM). Among the specializations offered is electromechanics, one of the most complex types of engineering in the market.

The most popular university in the country today, due to its extensive academic offering, is the Universidad Boliviana, a consortium of a private and eight public universities located in several cities across the country, including La Paz, Cochabamba, Santa Cruz, Sucre, Tarija, and Trinidad.

When it comes to engineering and computer science, one of the highest regarded institutions is the Universidad San Francisco Xavier de Chuquisaca, which provides specific majors in engineering and agriculture.

Because IT graduates are extremely sought after by local and international companies, scholarships have become more abundant. Not only do the universities themselves provide partial and full scholarships, but also students can apply to international scholarships provided by institutions such as the Organization of American States (OAS), the Women’s Rights Program (for women interested in pursuing IT careers), EuroInkaNet, UNESCO, or the World Bank.

English Proficiency

Although Spanish is the official language of Bolivia, English has become a common area of study among IT students due to the fact that technical textbooks and exams are administered in English. English is also the most prevalent second language among the IT workforce as it’s key to being able to work overseas or in international tech corporations.

For the first time since the EF English Proficiency Index was created, Bolivia has entered the ranking, achieving the 66th position globally, just below Colombia. Bolivians are highly interested in improving their language proficiency. In fact, according to a recent study conducted by the British Council in Santa Cruz, 61.1% of the people surveyed intend to study the language in the next two years.

Flight Connectivity

Bolivia has four international airports located in its main cities for software development, providing foreign executives and investors with great access to flights. International airports offer connecting flights with over 20 local airports as well.

  • Flight time from L.A to La Paz: 12 h
  • Flight time from N.Y to La Paz:  11 h 30 min
  • Flight time from Miami to La Paz: 9 h 10 min
  • Flight time from Miami to Cochabamba: 15 h 45 min
  • Flight time from N.Y to Cochabamba: 15 h 52 min

 

Time Zone

Bolivia’s official world time zone is GMT-4, exactly the same as New York and Miami, and only three hours ahead of Los Angeles (GMT-7), providing the perfect scenario for international, real-time collaboration.

Holidays and mandatory leave days

According to local labor laws, Bolivian employees are entitled to 15 days of mandatory vacation per year. In terms of national holidays, Bolivians enjoy 11 days, and in some cases, an additional 9 public holidays, celebrated in specific states throughout the country.

An Emerging Tech Hub in South America

In the last few years, Bolivia  has begun to realize its potential in the areas of engineering and computer science by strengthening its educational and professional systems.

Overall, Bolivia is becoming an attractive tech hub for other countries in the region and several international agreements to develop software for countries such the US and India are ensuring that its growth will continue.



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