Could your next IT project come from Brazil?

Brazil is emerging as an IT powerhouse, with attention from all the big names in tech such as Microsoft, Google and Intel.

"There was no environment for people to stay in the academic environment," says minister Rezende. "Science is quite new in Brazil and it has not been an engine in development for the country. We've had a historical lack of R&D and innovation culture, we've had a lack of continuity in science and technology, there's been no connection between the science and technology policies."

Things have changed, he believes. Now Brazilian researchers write two per cent of all the scientific papers published worldwide and 23,000 new IT graduates join the 1.7 million IT professionals in Brazil each year.

Connecting to Brazil

Among the BRIC countries, China is shorthand for cheap manufacturing and India has the lions's share of outsourcing, software development and call centres. Brazil is positioning itself as a better fit for Western companies looking for an offshore location.

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"We have cultural compatibility with countries such as the US," claims Arnaldo Bacha, the vice president of the Brazilian software association SOFTEX. "We understand the Western way of doing business".

And for US companies at least, Brazil has the advantage of being in the same timezone. Proving that there's a silver lining in anything, BRASSCOM's Sergio Pessoa points out that "the hyperinflation of the 1980s helped create more automation in the IT and telecoms spaces. And we have had some wins on bills that will help reduce the cost of doing in business in Brazil."

Winning investment

What attracts big-name IT companies like Google and IBM isn't just the human capital of an educated workforce but the generous development funding offered by the Brazilian investment bank BNDES.

There's little venture capital in Brazil as yet and BNDES which is owned by the Brazilian government and invests in key areas like IT, telecoms and biotech as well as energy and agriculture - provides funding from seed capital and angel investment through to IPOs.

BNDES's PROSOFT finance program is designed to encourage the software industry in Brazil. "It provide support for multinationals that would like to use Brazil as a base," says BNDES director Mauricio Neves and offers "better conditions of long-term financing at even lower interest rates; special credit rules make it very easy for companies to have access to finance."

IBM is one of the largest beneficiaries of PROSOFT. There are other incentives adds Pessoa. "For every dollar invested in research and development or training, you can deduct two dollars in taxes."

Inviting global technology brands to set up in Brazil is a big change from the country's earlier exclusionary policies between 1977 and 1992, Brazil attempted to grow its own hardware economy by refusing to grant import licences for a range of computer hardware, including PCs.

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