Argentina is betting on programming to boost its tech sector

Is better education the key to investment in Argentinian tech?

Argentina plans to enhance its IT sector by investing further in computer programming courses for students. It’s just one necessary step that Argentina will be taking to enhance its tech sector from the ground up and ultimately lead to greater investment in the industry.

The scheme will formalise programming across the country’s schools and place a new focus on the importance of technology to the country, both economically and socially.

It is hoped to bridge a potentially worrying skills gap in Argentina’s tech sector and make future recruits attractive to CEOs and improve company performances overall to lure in more investors.

Argentinian near-shore IT outsourcing firm Belatrix was one of the first local companies to promote the initiative. The country’s education system needs rethinking in order to shape students for future job opportunities, writes Alex Robio, Belatrix president and co-founder.

“With the dynamic changes currently underway in the technology sector (jobs for example such as mobile app developers, which didn’t exist 10 years ago), education systems must also actively change to ensure young people have the skills they need to enter the workforce,” says Robio.

Latin America presents a lot of opportunities to the global IT sector but each individual country throws up its own challenges. According to a report from consultancy Neo Group [PDF], Argentina is particularly strong in software development and an attractive spot for industry outsourcing while the country’s IT market is tipped to grow more than 10% between now and 2019.

IBM and HP are just some of the global tech firms that have set up operations in Argentina but the country’s start-ups require their own stimulus too.

“We believe this announcement by the Education Ministry will help further cement this reputation, and ensure a strong supply of individuals with technology skills in the coming years,” adds Robio.

Technology and specifically computer programming has had some successes in Argentina. In June the University of Buenos Aires was recognised for computer programming skills in the International ACM Programming content. UBA finished 18th in the global rankings, with Harvard coming 19th, making it the highest ranking university in South America for computer skills.

The country produces on average 98,000 graduates and 11,000 postgraduates, creating a skilled workforce across various fields, so the ministry’s new plans hope to plant the seeds for IT and computing skills at a young age.

The building blocks are certainly there for Argentina to grow its IT sector by focusing on its impressive programming reputation.

Argentina still has numerous challenges for growing its technology sector as well as other sectors though.

Economic instability and defaulting on its sovereign debt has, of course, had a profound effect on Argentina’s business community. Despite these obvious challenges, Argentina’s tech and start-up scenes, as well as recent investments in the country’s fashion industry, have made some bold efforts to get a foothold in South America’s ever-evolving economies.

Colombia and Chile for example are building some strong start-up reputations in Latin America. Argentina is hot on their heels and the powers that be have begun to understand that now. Presidential candidate Daniel Scioli has vowed to increase spending on technology and science by 1% of GDP, it currently invests at 0.6%, as bringing business and investment to Argentina is one of the many talking points for the October 25th general election.

Following the country’s crippling default in 2014 – its second in less than 15 years – the country was viewed as persona non grata for investors; it was simply too unstable.

Now investors, from all industries, have shown an interest in Argentina once again. This is especially true in the light of President Cristina Kirchner stepping down later this year as her policies were often at odds with investors’. But stability isn’t a guarantee following her departure and the forthcoming election. “It will be much more difficult from here, because the political season is ramping up,” said Cullen Thompson, founder of Bienville Capital.

A fresh spate of investors though, specifically ones interested in tech start-ups, will be absolutely necessary for any companies that emerge from Argentina’s new found focus on technology education.

Despite its noted economic issues, Argentina has a lot of benefits for a young start-up, especially in getting started. The International Finance Corporation shows that setting up a company is one of the smoother processes compared with other countries, generally taking a couple of days and about $300 in fees.

Capital Buenos Aires is, unsurprisingly, the business hub for the country. The ‘Argentinian eBay’ Mercadolibre, with operations across Latin America, is headquartered in Buenos Aires, as too is KaszeK Ventures. The firm has invested in several successful local start-ups, such as taxi app SaferTaxi that wants to go head to head with Uber in its native South America, and online restaurant reservation service Restorando. The firm had previously invested in mobile games developer Zupcat too, which then sealed a new funding round from an angel investor in June.

Argentina is seeing plenty of activity across its technology economy but solid education programs that encourage careers in tech are needed to ensure the industry’s future.