Brazilian Digital Ecosystem

The Role of Technology to overcome
Brazilian Economy Bottlenecks
Brazil – From sky-rocketing GDP growth…..
….. To the “Pibinho”
GDP
% change on a year earlier

8
6
4
2
0
2003

05

07

09

11 12 13

2 (-)

Brazil - missed chance of sustainable economi...
INFRASTRUCTURE

EDUCATION

PRODUCTIVITY

TAX & SYSTEM

Brazilian structural bottlenecks and interaction with the digital e...
Productivity & Growth Bottlenecks

Challenges

INFRASTRUCTURE

Disaggregated, isolated, private infrastructures

(Transpor...
Total Value of Infrastructure Stock
% GDP

Brazil’s stock of infrastructure value to GDP is 4x less than in developed econ...
Productivity & Growth Bottlenecks

Challenges

INFRASTRUCTURE
(Transport, Telecom, Energy)

Disaggregated, isolated, priva...
Productivity & Growth Bottlenecks

Challenges

INFRASTRUCTURE
(Transport, Telecom, Energy)

Disaggregated, isolated, priva...
Productivity contributed less to Growth in Brazil than in other rapidly developing economies
Breakdown of value-added grow...
Productivity & Growth Bottlenecks

Challenges

INFRASTRUCTURE
(Transport, Telecom, Energy)

Disaggregated, isolated, priva...
INFRASTRUCTURE

EDUCATION

PRODUCTIVITY

TAX & SYSTEM

Structural bottlenecks have shaped and impacted the digital ecosyst...
FRANCE
GDP in million

BRAZIL

US$2,775

US$2,476

Digital landscape: France vs Brazil

France and Brazil are the two firs...
Engagement
Key takeaways about the readiness of the
Brazilian digital ecosystem
•
•
•
•
•

Digital readiness impaired by s...
Regulatory, Business & Innovation Environment

Regulatory

Software Piracy rate
Laws related to ICT

Business Innovation

...
T AX & ADMI NI ST RAT I ON

AV E R A G E T I M E T O S TA R T A B U S I N E S S
In days

EDUC A T I ON

R&D INVESTMENTS & ...
Accessibility

Acessibility of digital content
Mobile Network coverage
Mobile Internet Penetration
Secure Internet servers...
I N FRAST RUCT URE

F I X E D B R A O D B A N D P E N E T R AT I O N
% population

FRANCE

24 M

35%

€ 10 / month (1GB)

...
Affordability

Mobile Internet broadband tariffs
Internet and telephony competition

Mobile cellular tariffs
Fixed Interne...
Engagement: technological uptake

Cellphone penetration
Internet users (% population)
Time spent online
Social networks pe...
P E N E T R AT I O N
F E AT U R E & S M A R T P H O N E S
INTERNET USERS
125%

AVERAG E
SMARTPHONE PRICE

99%

49% pop

18...
E-COMMERCE

8,7% of retail
€ 45Mds
31 M e-consumers
€ 8,6 Mds

2.5%

6.5%

60%

AVERAG E SHI PPI NG
TIME

35% higher in Br...
INFRASTRUCTURE

EDUCATION

PRODUCTIVITY

TAX & SYSTEM

Role of the Digital landscape in unlocking Brazilian Growth
Internet – Digital Maturity and contribution to GDP

Brazilian digital ecosystem still a low contributor to GDP growth
Productivity & Growth Bottlenecks

Technology solutions

INFRASTRUCTURE

Technology can act everywhere throughout
infrastr...
Productivity & Growth Bottlenecks

Technology solutions

INFRASTRUCTURE

Technology can act everywhere throughout
infrastr...
Productivity & Growth Bottlenecks

Technology solutions

INFRASTRUCTURE

Technology can act everywhere throughout
infrastr...
Productivity & Growth Bottlenecks

Technology solutions

INFRASTRUCTURE

Technology can act everywhere throughout
infrastr...
Financial Sector

Agri-Tech

Oil & Gaz - Mining

Aeronautical

Mobile applications & Services

Consumer Digital / Media

B...
Brazilian next tech forces ?

Brazilian “Tech forces”
Brazilian GDP vs ICT sector (growth)

3x30000%

2.5x
25000%

2x20000%

15000%
1.5x

1x10000%

5000%

0%
2004

2005

2006

...
IT for Education vs Education sector (2011-2016)

IT for Health vs Heathcare sector (2011-2016)

% change on a year earlie...
Upcoming SlideShare
Loading in …5
×

Brazilian growth bottlenecks and digital ecosystem

310
-1

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
310
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
7
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Brazilian growth bottlenecks and digital ecosystem

  1. 1. Brazilian Digital Ecosystem The Role of Technology to overcome Brazilian Economy Bottlenecks
  2. 2. Brazil – From sky-rocketing GDP growth…..
  3. 3. ….. To the “Pibinho”
  4. 4. GDP % change on a year earlier 8 6 4 2 0 2003 05 07 09 11 12 13 2 (-) Brazil - missed chance of sustainable economic growth ?
  5. 5. INFRASTRUCTURE EDUCATION PRODUCTIVITY TAX & SYSTEM Brazilian structural bottlenecks and interaction with the digital ecosystem
  6. 6. Productivity & Growth Bottlenecks Challenges INFRASTRUCTURE Disaggregated, isolated, private infrastructures (Transport, Telecom, Energy) (Brazil: 114th out of 148 countries) Skilled labor shortage (high turnover and cost) EDUCATION (Brasil (190M): 37 mil engenheiros/ano. Coreia do Sul (48M: 92 mil) - Brazilian education still ranks 88th INDUSTRIAL PRODUCTIVITY Industrial competitivity and productivity (Auto, Equipments…) TAX & ADMINISTRATION The Brazil cost: Tax burden and bureaucracy Brazil Growth Bottlenecks: Infrastructure
  7. 7. Total Value of Infrastructure Stock % GDP Brazil’s stock of infrastructure value to GDP is 4x less than in developed economies
  8. 8. Productivity & Growth Bottlenecks Challenges INFRASTRUCTURE (Transport, Telecom, Energy) Disaggregated, isolated, private infrastructures EDUCATION Skilled labor shortage (high churn and cost) – education quality (55th/65th)* (Brazil: 114th out of 148 countries) (Brasil (190M): 37 mil engenheiros/ano. Coreia do Sul (48M: 92 mil) - Brazilian education still ranks 88th INDUSTRIAL PRODUCTIVITY Industrial competitivity and productivity (Auto, Equipments…) TAX & ADMINISTRATION The Brazil cost: Tax burden and bureaucracy * Program for International Student Assessment’s analysis of quality of basic education Brazil Growth Bottlenecks: Education
  9. 9. Productivity & Growth Bottlenecks Challenges INFRASTRUCTURE (Transport, Telecom, Energy) Disaggregated, isolated, private infrastructures (Brazil: 114th out of 148 countries) Skilled labor shortage (high turnover and cost) EDUCATION (Brasil (190M): 37 mil engenheiros/ano. Coreia do Sul (48M: 92 mil) - Brazilian education still ranks 88th INDUSTRIAL PRODUCTIVITY Industrial competitivity and productivity (Auto, Equipments…) TAX & ADMINISTRATION The Brazil cost: Tax burden and bureaucracy Brazil Growth Bottlenecks: Competitiveness
  10. 10. Productivity contributed less to Growth in Brazil than in other rapidly developing economies Breakdown of value-added growth, 2002-2012 7 18 28 40 93 82 72 60 60 70 40 30 China CAGR 2002-2012 (%) India South Korea Mexico Russia 10.6 7.8 4.2 2.3 4.6 Chile 4.1 Source: Euromonitor, BCG analysis Productivity gains contribution to GDP is very low Employment growth (%) 74 26 Brazil 3.7 Productivity gains (%)
  11. 11. Productivity & Growth Bottlenecks Challenges INFRASTRUCTURE (Transport, Telecom, Energy) Disaggregated, isolated, private infrastructures EDUCATION (Brazil: 114th out of 148 countries) Skilled labor shortage (high turnover and cost) (Brasil (190M): 37 mil engenheiros/ano. Coreia do Sul (48M: 92 mil) - Brazilian education still ranks 88th INDUSTRIAL PRODUCTIVITY Industrial competitivity and productivity (Auto, Equipments…) TAX & ADMINISTRATION The Brazil cost: Tax burden and bureaucracy Brazil Growth Bottlenecks: Tax burden & bureaucracy
  12. 12. INFRASTRUCTURE EDUCATION PRODUCTIVITY TAX & SYSTEM Structural bottlenecks have shaped and impacted the digital ecosystem
  13. 13. FRANCE GDP in million BRAZIL US$2,775 US$2,476 Digital landscape: France vs Brazil France and Brazil are the two first Latin economic powers
  14. 14. Engagement Key takeaways about the readiness of the Brazilian digital ecosystem • • • • • Digital readiness impaired by structural bottlenecks Business and Innovation environment is not supportive Accessibility is average and Affordability is still a challenge Engagement is high throughout individuals, businesses and governments Online spending are still lagging (e-commerce & online advertising) Environment Acessibility (Regulatory, Business & Innovation) Affordability FRANCE Worldwide Ranking: BRAZIL 26th 60th (World Economic Forum) Brazil: High engagement but challenging affordability & environment
  15. 15. Regulatory, Business & Innovation Environment Regulatory Software Piracy rate Laws related to ICT Business Innovation Availability of latest technologies Venture Capital Availability Intensity of local competition Skills Quality of management schools FRANCE 27th IP protection Number of days – procedures to start a business Total Tax rate (% profit) Quality of education system R&D Research BRAZIL 107th World Economic Forum Brazil: an impaired digital environment
  16. 16. T AX & ADMI NI ST RAT I ON AV E R A G E T I M E T O S TA R T A B U S I N E S S In days EDUC A T I ON R&D INVESTMENTS & JOBS 2.25% GDP 111 days 7 days 7 days 33 days Brazil France China 13 procedures 1.16% GDP R&D technicians in France vs Brazil per 100 habs 5 procedures FRANCE World Economic Forum Digital environment BRAZIL 3x
  17. 17. Accessibility Acessibility of digital content Mobile Network coverage Mobile Internet Penetration Secure Internet servers Fixed broadband penetration FRANCE BRAZIL 28th 62th World Economic Forum Brazil: Average Accessibility
  18. 18. I N FRAST RUCT URE F I X E D B R A O D B A N D P E N E T R AT I O N % population FRANCE 24 M 35% € 10 / month (1GB) BRESIL 19 M 10% € 20 / month (1GB) M O B I L E B R O A D B A N D P E N E T R AT I O N % population 3G COVERAGE FRANCE 33 M 50% BRAZIL 77 M 38% FRANCE % population 98% BRAZIL World Economic Forum Digital Accessibility 90%
  19. 19. Affordability Mobile Internet broadband tariffs Internet and telephony competition Mobile cellular tariffs Fixed Internet Broadband tariffs Smartphone price FRANCE BRAZIL 86th 76th World Economic Forum Brazil: Still a challenging affordability
  20. 20. Engagement: technological uptake Cellphone penetration Internet users (% population) Time spent online Social networks penetration Business Usage of internet Governement usage of internet E-commerce penetration (e-consumers) Online advertising penetration (% total retail) FRANCE BRAZIL 22th 44th World Economic Forum Brazil: High usage and technological uptake
  21. 21. P E N E T R AT I O N F E AT U R E & S M A R T P H O N E S INTERNET USERS 125% AVERAG E SMARTPHONE PRICE 99% 49% pop 18% 38% 96M 54M P O S T PA I D P L A N S 83% pop % mobile phones 78% 361 mins 90% 535 mins 91% 21% € 390 2 GB DATA MOBILE PLAN € 20 ... € 38 .... Source: Brasscom, WOF, McKinsey, Valor, IBGE, Comscore, eMarketer FRANCE Digital engagement is high BRAZIL € 285
  22. 22. E-COMMERCE 8,7% of retail € 45Mds 31 M e-consumers € 8,6 Mds 2.5% 6.5% 60% AVERAG E SHI PPI NG TIME 35% higher in Brazil 40% AVERAG E SHIPPING COST 3% of retail 43 M e-consumers AVERAG E T RA NSACT I O N COST FOR E-SELLER (Acquirer + Fraud control) INTERNET USERS TO E-CONSUMERS 2x higher in Brazil % internet user population 27% ONLINE ADVERTISING % total advertising revenue 10% € 2,7B € 1,25B Source: Brasscom, WOF, McKinsey, Valor, IBGE, Comscore, eMarketer Digital spendings still shy
  23. 23. INFRASTRUCTURE EDUCATION PRODUCTIVITY TAX & SYSTEM Role of the Digital landscape in unlocking Brazilian Growth
  24. 24. Internet – Digital Maturity and contribution to GDP Brazilian digital ecosystem still a low contributor to GDP growth
  25. 25. Productivity & Growth Bottlenecks Technology solutions INFRASTRUCTURE Technology can act everywhere throughout infrastructure supply-chains with high efficiency / cost ratio and agility (Transport, Telecom, Energy) EDUCATION E-learning platforms (distance education), Digital content production, job networks, University / School efficiency INDUSTRIAL PRODUCTIVITY From Price positioning to Value positioning, Lean processs & Automation TAX & ADMINISTRATION Public administration modernization and efficiency (E-gov, Electronic filling and accounting system (SPED) Technology to overcome Brazil Growth Bottlenecks
  26. 26. Productivity & Growth Bottlenecks Technology solutions INFRASTRUCTURE Technology can act everywhere throughout infrastructure supply-chains with high efficiency / cost ratio and agility (Transport, Telecom, Energy) EDUCATION E-learning platforms (distance education), Digital content production, job networks, University / School efficiency INDUSTRIAL PRODUCTIVITY From Price positioning to Value positioning, Lean processs & Automation TAX & ADMINISTRATION Public administration modernization and efficiency (E-gov, Electronic filling and accounting system (SPED) Technology to overcome Brazil Growth Bottlenecks
  27. 27. Productivity & Growth Bottlenecks Technology solutions INFRASTRUCTURE Technology can act everywhere throughout infrastructure supply-chains with high efficiency / cost ratio and agility (Transport, Telecom, Energy) EDUCATION E-learning platforms (distance education), Digital content production, job networks, University / School efficiency INDUSTRIAL PRODUCTIVITY From Price positioning to Value positioning, Lean processs & Automation TAX & ADMINISTRATION Public administration modernization and efficiency (E-gov, Electronic filling and accounting system (SPED) Technology to overcome Brazil Growth Bottlenecks
  28. 28. Productivity & Growth Bottlenecks Technology solutions INFRASTRUCTURE Technology can act everywhere throughout infrastructure supply-chains with high efficiency / cost ratio and agility (Transport, Telecom, Energy) EDUCATION E-learning platforms (distance education), Digital content production, job networks, University / School efficiency INDUSTRIAL PRODUCTIVITY From Price positioning to Value positioning, Lean processs & Automation TAX & ADMINISTRATION Public administration modernization and efficiency (E-gov, Electronic filling and accounting system (SPED) Technology to overcome Brazil Growth Bottlenecks
  29. 29. Financial Sector Agri-Tech Oil & Gaz - Mining Aeronautical Mobile applications & Services Consumer Digital / Media Brazilian “Tech forces” (Necessity drives innovation)
  30. 30. Brazilian next tech forces ? Brazilian “Tech forces”
  31. 31. Brazilian GDP vs ICT sector (growth) 3x30000% 2.5x 25000% 2x20000% 15000% 1.5x 1x10000% 5000% 0% 2004 2005 2006 2007 2008 GDP 2009 2010 2011 2012 ICT sector Source: Brasscom,, IBGE, The ITC sector has constantly over-performed the GDP 2013 -
  32. 32. IT for Education vs Education sector (2011-2016) IT for Health vs Heathcare sector (2011-2016) % change on a year earlier 5x % change on a year earlier 500 450 4x 400 350 CAGR 23% 3x CAGR 24% 300 250 2x 200 150 1x 100 50 0 2011 2012 2013 Education sector growth 2014 2015 2014 Education technology growth 2016 2011 2012 2013 2014 Healthcare sector growth 2015 2014 IT for Health growth Source: Brasscom,, IBGE, IT for Education & Health set to strongly over-perform their underlying sector 2016

×