Brazil stagnates in technical investment and innovation

Brazil is at the bottom of the ranking of competitiveness in terms of investment in technology and innovation. In 59th position out of 63 countries analysed, the country has only surpassed South Africa, Mongolia, Argentina and Venezuela.

According to the analysis of the International Institute for Management Development (IMD) in collaboration with the Brazilian business school Fundação Dom Cabral (FDC), Brazil has fallen two positions from last year’s ranking. The decline is related to negative performance in areas such as infrastructure, availability of skilled labor and legal certainty.

The ranking uses 333 variables that inform the pillars of economic performance, government and business efficiency, as well as infrastructure. The review also uses macroeconomic indicators and qualitative data from 5,500 executives interviewed in all countries covered in the survey. In Brazil, FDC interviewed 134 business leaders.

Brazil is in the same position as in the IDC ranking in 2019. The country’s best performance in the list, now in its 34th year, was 2020 when it was ranked 56th. Denmark tops the IMD list, followed by Switzerland and Singapore. The top 10 countries in the ranking includes the United States, in 10th position. In Latin America, Chile leads in 45th place, followed by Peru (54th), Mexico (55th), Colombia (57th), Brazil (59th), Argentina (62nd) and Venezuela (63rd).

Especially in the business efficiency pillar, Brazil dropped three positions and is now in 52nd place. According to FDC, factors that have contributed to the decline include a brain drain and challenges to adopt new technologies due to the persisting skills gap and lack of investment.

Data from a separate study conducted by the National Industry Observatory to identify future labor demand illustrates the skills issues in Brazil. According to the study, Brazil will need to train 9.6 million workers in the manufacturing sector alone over the next three years due to the increasing adoption of new technologies in the sector.

As for the shortage of technology professionals in general, the situation is also critical. Data from the Brazilian Association of Information Technology and Communications Companies (Brasscom) suggests that 420,000 new technology workers will be needed between 2019 and 2024 to meet the industry’s demands. Annually that would equate to 70,000 professionals – but Brazil produces only 46,000 technical professionals each year.

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