Source: The Sacremento Bee
When we speak of exports, we usually associate them with products such as fruit and wine; however, technology, videogames or engineering, for example, also go out into the world to provide effective solutions and opportunities for development. This is the behavior shown by countries such as China, India, Korea, Brazil, Mexico and Russia, which are currently the leading countries in the export of services. Chile also figures as an important supplier in this worldwide trend.
According to the World Trade Organization, services generate two-thirds of the world total of added value, and their export is growing at rates above 10%. In Chile, the export of services in 2010 reached $10,800 million U.S.; it has grown at rates averaging 9% over the past decade and accounts for 60% of GDP, and 70% of the labor force. Furthermore, it is estimated that the export of Chilean services will reach $13,000 million U.S. by the end of 2011.
In addition to being a sector in development, the chief advantage of the export of services lies in the fact that it is a commercial opportunity allowing for an exchange of knowledge and experience, which confers added value on what is exported. By themselves, commodities and natural resources do not make it possible to generate the margins necessary for the development of the economy, which is why developed countries also foster the development of human resources through education, creativity and innovation to support the advance of this sector which is, in addition, more stable in situations of economic crisis.
As a result of the economic development achieved in recent decades, the solidity of Chilean institutions and the commercial liberalization expressed in numerous free trade treaties, Chile has become a natural connecting bridge between the Americas and the world. Thereby, it currently has access to a potential market of 4 billion individuals on five continents, who have already started to become familiar with the level of professionalism in Chile, the numerous services available and the rich supply of exportable products.
Argentina is the main recipient with regard to services (27%), followed by Peru (23%), the United States (14%), Brazil (13%) and Colombia (6%). These five locations account for 83% of the direct investment in the sector.
Some key sectors
Contributing to the country’s economic and social development through the potential provided by the use of information and communication technologies to improve the quality of life of the population and encourage the development of the country – this is the objective of the Digital Strategy.
In 2009, Chilean exports for this sector added up to $718 million U.S. As of the present date, Latin America (with 42.3%) and the United States (with 29.2%) continue to be the principal markets.
Within the broad array of services that this sector has to offer are those involving Hardware, Software, IT Services, Software customization, Online Services, ITO (Information Technology Outsourcing), BPO Telecommunications software, and Call Centers.
With regard to the latter, providers of contact center and call services have capitalized the technical capacities of labor, allowing the country to become an offshore operations trampoline for South America. It is estimated that the total number of employees in the Chilean outsourcing sector was approximately 20,000 in 2008, and which has since grown to about 30,000 this year.
Chile is considered one of the most technologically and electronically advanced countries in the region, and for this very reason, it attracts investments from businesses with high technological value. In addition, the provision of multilingual services and its geographical proximity make Chile a nearshore center for clients in the U.S., which is Chile’s second largest export market, with 21.1%. First place is held by South America, with 50.4%, while Europe is in third place, with 18.9%.
With regard to education, increasing the number of foreign students at Chilean universities is the main objective of this sector. In 2010, the higher education system was made up of 177 institutions, among them, 60 universities, 44 vocational institutes and 73 centers for technical training. According to the OECD report, “Education at a Glance 2011” in 2009, Higher Education in Chile represented around 12,200 foreign students who entered the country; of these, almost 80% were at universities, which signifies estimated revenues of more than $160 million U.S. annually under the headings of matriculation and living expenses.
As for biotechnology services, the number of companies that fall within this sector comes to 201, including producing companies, (93), companies offering specialized services (22), University Research Centers (61), Technology Transfer Centers (10) and Incubators (15).
Burrill & Co estimates that the distribution of the industry in areas of specialization breaks down into industrial biotech, with 22%; human health and nutrition, with 22%; agriculture and livestock, with 42%; the fisheries industry, with 8%, and finally, forestry, with the same amount.
According to estimates by the same firm, Chile is among the 25 leading nations with respect to clinical tests for infectious diseases and disorders of the central nervous system.
But the video game industry is also a sector that is soaring when it comes to demand. At the global level, this sector had billing of $59 billion U.S. in 2009, with Europe, the Middle East and Africa as the markets where the greatest consumption is recorded. With these figures, it has surpassed other creative industries such as music and cinema. It is estimated that value in sales will be around $68 billion U.S. in 2012.
In Chile there are more than 17 companies that are developers of video games focusing on different consumption platforms. In 2010 they exported around $ 3 million U.S., and in 2012 they expect to exceed $15 million U.S.