You may not know much about Uruguay, the small country in South America with only 3.5 million people.
And, among those people, there are those who created our company!
We’ve discussed some fun facts about Uruguay before.
Today we’d love to dive deeper into the nearshoring landscape for software development companies.
Uruguay has a relatively stable political climate and a well-developed regulatory environment.
The country has a high literacy rate and a well-educated workforce, which makes it attractive for investors.
Historically, our country has focused its economic diversification on agriculture, services, and manufacturing.
Yet, in the last couple of decades, software development has become a limelight within manufacturing.
Moreover, the government encourages foreign investment with tax incentives and simplified bureaucratic procedures.
Additionally, Uruguay has free trade agreements with several countries, which has helped to increase investment flows.
Recently, Uruguay became an attractive destination for international IT companies.
Let’s explore some factors that contributed to creating this special worldwide focus:
- Skilled Workforce. Uruguay has a highly educated workforce, with a strong emphasis on STEM education, making it an attractive for IT companies.
- Environmental Stability. The country has a stable political environment, well-developed regulations and a relatively low level of corruption.
- Strategic Location. Strategically positioned in the Southern Cone of South America, Uruguay has easy access to major regional markets.
- Government Support. The Uruguayan government has implemented policies encouraging foreign investment in the IT sector.
The business climate to open a new IT company as a local entrepreneur in Uruguay is generally favorable.
However, there are some challenges that local entrepreneurs may face when starting a new IT company in Uruguay.
These challenges include:
- Financing. Access to financing can be difficult for entrepreneurs, particularly for startups with no proven track record.
- Competition. As you may guess, we’ve become an attractive destination for foreign IT companies.
- Market. In the end, Uruguay has a relatively small domestic market. As a result, this market may cut local IT companies' growth potential.
Despite these challenges, the overall business climate for local entrepreneurs in Uruguay's IT sector is positive.
The government has recognized the importance of the sector and is committed to supporting its growth.
This has created a favorable environment for innovation and entrepreneurship.
Furthermore, we’ve witnessed several improvements in the software development landscape.
Let’s go over some of these!
- Growth. Uruguayan Fintech has seen significant growth over the past years.
- eCommerce. Like with so many other countries, the COVID-19 pandemic accelerated the growth of eCommerce in Uruguay.
- Tech Adoption. Uruguay keeps adopting new techs to improve efficiency, like Montevideo’s Port new blockchain-based platform.
Ultimately, investing in Uruguay's talent is always a wise choice!
We have an amazing, ethical, and talented workforce, and current globalization is an amazing tool to enhance worldwide partnerships.
Are you looking for a business partner to expand your product or service? Give us a call!
We’d be delighted to tell you more about it over a nice mate and some dulce de leche!
