How Bolivia Is Evolving Into a Nearshore Development Contender

Thanks to the efforts of private companies and growing interest from its national government, Bolivia is showing increasingly positive signs of becoming a contender in the Nearshore software development market.

With a population of only 11 million people and over 10,000 software development engineers, Bolivia’s talent pool may seem outnumbered by several larger nations in Latin America. However, steady improvements to the country’s language capabilities and technology ecosystem are helping more U.S. customers recognize an opportunity for high-quality software development services at competitive rates.

To give you a better idea of the country’s position in the Nearshore market, here’s our on-the-ground perspective on Bolivia’s recent advancements in education, engineering talent, digital growth, and language skills.

Education Investments and Talent Growth

The cities of Cochabamba and La Paz are both home to over 20 universities, of which 13 and 18, respectively, offer careers in computer science and systems engineering. Over the last five to six years, the two cities have been producing around 350 new engineers per year: 150 in Cochabamba and 200 in La Paz. In 2020, it’s estimated that the whole country will produce a combined total of at least 500, a number that is expected to grow year-on-year due to the boom in the IT Industry.

As software development companies increase in number in the country, there is a greater demand for IT graduates each year, with a larger enrollment of students in universities during the last decade. Furthermore, market conditions are empowering new graduates to stay in the country to hone their skills further, increasing retention rates and expanding the country’s knowledge pool.

High Levels of English Proficiency

Following the government’s decision to promote trilingual education, which includes Spanish, a native language, and a foreign language, Bolivia has made great strides towards developing world-class English language capabilities. Most notably, English is now compulsory in all public and private schools, with the former starting from 6th grade and the latter from 1st grade.

In 2019, Bolivia rose from 12th place to 9th place on the EF EPI rankings for English proficiency in Latin America, achieving a score well ahead of Mexico (16th) and Colombia (17th), two of the most dominant players in the nearshore software development market. Not bad for one of the smallest populations in the region.

In terms of accent and pronunciation, Bolivia’s English speakers stand out in Latin America for their ability to handle the language with great skill. This proficiency is even higher in the area of outsourced IT services, as English has long been the “official” language for software development and computer science.

With the increase of companies in the United States partnering with Bolivian software development service providers, we’re seeing that the outside influence of native speakers is having a huge positive impact on the industry’s overall English capabilities, which will only continue as more buyers start to recognize the country’s value.

Industry Snapshot and Growing Tech Scene

According to the Electronic Government and ICT Agency (AGETIC), there are currently more than 200 software development companies in Bolivia, collectively pulling in around US$30 million every year in exports, mainly from the United States. On top of that, there is a growing pool of engineers who provide freelance services, which are estimated to bring in an additional US$20 million.

After the first initiatives in La Paz in the late 1990s, Cochabamba has been spearheading the country’s growth of IT companies and was declared the country’s official headquarters for a technological citadel (Ciudadela Tecnológica) in 2015. Today, the city is seeing a constant introduction of initiatives to foster research and development, as well as investments in infrastructure.

With the country’s growing focus on technology businesses, infrastructure, research, and global partnerships, we expect the number of software companies to rise rapidly over the coming years, creating a healthy dose of competition for us in the market.

Economic Stability, Travel, and Time Zone

Thanks to its stable economy, Bolivia is one of the most economically favorable destinations in the world for travelers, which is helping to attract global digital nomads and investors. This has led to a boom in the number of co-working spaces across the country.

Direct flights from Miami to the different international airports in Bolivia take just under seven hours. The country also has a highly suitable time zone for collaboration with North American companies. At GMT-4, it shares eastern time most of the year and is only three hours ahead of Los Angeles.

As the nation faces elections in the coming months, political candidates are not only proposing new investments into green energy but also stressing an in-depth focus on ways to benefit the local IT industry.

They are presenting plans to improve Bolivia’s territorial fiber optic connectivity between Brazil and Peru, along with announcing discussions with Intel, Google, and Facebook about introducing new initiatives, such as microchip assembly plants in El Alto and La Paz, new data centers to serve countries in South America, and widespread internet accessibility to expand upon existing efforts by internet.org and Facebook.

In closing, as the country’s tech scene evolves, costs remain low, and education continues to improve, it’s never been a better time to consider Bolivia as your next Nearshore software development destination.