by Carlos Pallottiformer CEO of Argencon
Over the past 25 years, Argentina has seen tremendous growth in its technology industry (commonly referred to as the “knowledge economy”). Employment went from 15,000 to 300,000, and exports went from just over $150 million to $9.6 billion. From last quarter. This made the activity the third largest export complex and one of the main sources of private employment.
This growth has been driven by the large-scale digitalization of economic, production and social processes, and Argentina has found an innovative environment to offer the world. Qualified personnel at reasonable prices.
In this context, thousands of companies were founded, some of which were particularly successful. Unicorns are hundreds of companies whose products and services are internationally recognized and have achieved valuations of more than US$1 billion within 10 years. There are more than 10 unicorn companies. Among them, Mercado Libre, the most valuable company in Latin America.
The nation, at all levels, He became acquainted with the field as its growth became more noticeable. I was creating promotional and development vehicles for the industry. The national government took note of this in 2003; “Software Law”This law was a very useful tool that quadrupled the tax collection from the sector’s revenues and increased employment and exports tenfold. Today, this law has changed into: “Knowledge Economy Law”approved and refined by every subsequent government, making it one of our country’s few genuine national policies. In that sense, the National Administration created a specific field to deal with problems in this field, which still holds the rank of Under-Secretary. The industry was not immune to this and continued to grow even during the economic crisis.
State and local governments also accompanied this process through a variety of measures focused on training, credits and subsidies, support for entrepreneurs, and the creation of tax breaks, among other concrete actions to foster the development of the sector.
Along this path, I assert that the nation has kept two very important points in mind. First, it is an economic area of national focus. We don’t need to compete, we need to support, And secondly, his role is create the right conditions It’s about growing without too much intervention or unnecessary regulation.
But what’s interesting about this growth is that it was initially concentrated in large cities, but it gradually became federalized. Particularly after the pandemic, governments have recognized the importance of solving two key challenges for economic development: people’s preparedness and good connectivity.
Thus, in recent years we have seen that employment in the so-called “inland” has grown two to three times faster than in the AMBA. There are also intermediate cities that are growing even more rapidly.
This has led some states and local governments to create specific regions to serve this sector or to partner with local business associations to promote specific activities. The states of Córdoba, Caba, Mendoza, Tucuman, Neuquen, Salta, San Luis, Catamarca and Misiones, among others, have given particular attention to policies that promote this sector. Or municipalities such as Tandil, Mendoza, Godoy Cruz, Rio Cuarto, Rafaela, Mar del Plata, Yerba Buena, Cordoba, to name just a few.
Space is being created for technology parks, rezoning to transform neighborhoods into technology districts, incentives for investment, sponsorship of promotional trips and trade missions, training schemes, and more. On the other hand, decentralized public institutions such as the CFI and international credit institutions such as the IDB, World Bank, and CAF have been active in providing financial and promotional support.
In this context, what Entre Rios has developed in the city of Paraná is interesting and deserves special emphasis. A few days ago, Mirador Tech, a huge technology facility, was inaugurated in the Paraná Valley. Houses high-impact companies and projects. It aims to become a kind of technology hub where you can have space for developments that need to accelerate projects, as well as the development of applications, services and products.
Beyond the positive results it will bring, which I am sure will soon be seen, this project brings something very innovative in terms of the country’s role in this sector. It was the state government itself, led by Mr. Frigerio, who decided to turn the building, which was originally intended for government offices, into a state-of-the-art technology center, with the explicit statement that it would not house state offices. It also has two additional features that differentiate it from other similar efforts. It was done without the allocation of public funds from the state budget, and it was self-sustaining, meaning it was financed by its own resources. and strong participation of the state’s private techno-economic sector; Educational and scientific and technological subjects. That is, an ecosystem that finds spaces (physical and conceptual) that foster development and foster local economies and job creation.
The funding format and management mechanism using blockchain-generated tokens makes this center an interesting case study for implementing similar projects in other regions and countries.
In short, states understand this highly dynamic field in many ways, and in many cases have run political regimes that are well versed in how to respond to economic developments in the 21st century.
With this initiative, today is the time to extend these good practices to governments that have not yet integrated the knowledge economy industry into their strategic management objectives.
This is especially true given that the world has already entered the age of artificial intelligence and the new challenges are extremely dynamic. Indeed, Patagonia’s recent announcement of a major investment in a giant data center adds a new topic to the discussion and its potential regulatory framework. That is why important questions arise. It is the nation, Will you continue to look at this industry with a 21st century mindset? i hope so. This is because the sector has demonstrated its ability to grow and generate jobs and foreign exchange like no other.
