Nearshore Americas

Mexico and Colombia Recognize the Urgency of Artificial Intelligence

The artificial intelligence revolution has arrived. McKinsey estimates the global impact of AI will deliver the equivalent of an additional $13 trillion into world economies by 2030. PricewaterhouseCoopers forecasts an additional $15.7 trillion in that same year. Others believe those estimates are too conservative. The tech investor Tej Kohli sees AI adding $150 trillion – more than the net worth of the United States – in just five years.

Latin Americans are as enthusiastic about exploring AI as any other region. A recent MIT Technology Review Insights survey showed nearly 80% of major companies in Latin America have incorporated AI into their operations, compared to 87% in North America and 95% in Asia-Pacific. But the region needs to invest heavily in human capital if it is to play a significant role in what the World Economic Forum has dubbed the “Fourth Industrial Revolution” – a coming era of sweeping technology-driven change.

Enrique Cortés, leader of the AI Initiative Hub at Mexico’s Instituto Tecnológico de Monterrey

“The problem that I see today in Mexico and in many other places is we being very blind to what could happen,” said Enrique Cortés, leader of the AI Initiative Hub at Mexico’s Instituto Tecnológico de Monterrey (ITESM). “At the end of the original Industrial Revolution there was no net loss of jobs. But what happened was a giant disruption in people’s lives because they were no longer useful [to the economy]”

AI poses a greater threat to the population of developing economies as they rely more heavily on jobs in factories or agriculture that are now facing the prospect of automation. To counter that threat, public-private partnerships are essential, Cortés said.

Mexico’s First AI Hub

Last year, Tec de Monterrey launched Mexico’s first AI hub, based in Tec’s campus in Guadalajara in the western state of Jalisco. The hub aims to apply AI solutions to social and economic issues in the country. The Inter-American Development Bank (IDB) is financially supporting the initiative and partnerships with major tech firms such as Intel and IBM are already underway.

Cortés said Mexico was producing high-quality research on AI, but most of it remained purely theoretical. In contrast, Tec’s AI hub focuses on applying AI to real-world situations.

“We have a project with the IDB and the government of Jalisco that studies AI in problems that are of a social nature,” Cortés said. “Areas like healthcare, education and smart cities.”

Central Guadalajara

Tec de Monterrey is also translating and adapting an MIT Media Lab class on teaching the principles of AI to students between the ages of 12 to 15. The college will offer the program to Jalisco students in 2021.

“It won’t make them an expert but it will mean the students… understand that we are talking about mathematics, programming and data,” Cortés said. “They will lose that fearful sense that this is something very complicated.”

In addition to this public focus, the hub is also developing an ecosystem of private startups that are leveraging AI in a range of sectors including fintech and agriculture. Tec has also formed exchange programs with Berkeley, the Beijing Institute of Technology and Inria, France’s National Institute for Research in Digital Science and Technology.

Cortés stressed that AI was still so young that much of the educational progress in the field was happening informally, as part of hackathons or programs like AI Saturdays – a machine learning community which offers Saturday courses in AI techniques. He also said a significant amount of learning was happening thanks to free online courses.

“You see people learning certain AI techniques because they took an EDX class online,” Cortés said. “Sometimes that’s good enough to start working.”

Medellin Momentum

Santiago Ospina, Ruta N’s digital transformation manager

The Colombian city of Medellin has also taken a leading role in the scramble to train people for the AI revolution. The city is home to the startup accelerator Ruta N, which oversees numerous initiatives designed to make AI more approachable. The corporation runs a scouting and training program called Medellin Digital Talent, which needs at least 52,000 people with specialized IT skills by 2023.

“What we are doing is targeting high school students that are going to universities or looking for a job,” said Santiago Ospina, Ruta N’s digital transformation manager. “We are trying to convince job seekers to take courses and choose technology-related subjects.”

Ruta N has also partnered with three financial services companies to offer student loans through the SumanTI Educational Fund. “If you are going to study a technology-related program you can access this credit line,” Ospina said, adding that interest rates were so low that loans “are almost free.”

The fund offers support for educational courses in disruptive technologies such as blockchain, the Internet of things, big data, robotics and AI.

Students are the not the only demographic in need of AI education. Many business leaders know little about what AI means for their sector. In response to that problem, Ruta N is developing a digital course specifically to inform executives about digital transformation and encourage the early implementation of groundbreaking technologies.

While executives may not currently prioritize AI, the evidence suggests the payoffs from early experimentation can be significant. McKinsey’s latest AI Global Survey found 63% of companies that have adopted AI say it has boosted earnings in the areas where it is used.

Medellin skyline

Catching Up with AI

In the meantime, Medellin has experienced an influx of international firms seeking to capitalize on its healthy educational system and business ecosystem. The automation specialist Rockwell Automation  announced that it was opening a new office in the city earlier this month. The consulting group Accenture launched an innovation lab in the Ruta N complex in December last year.

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Ruta N is also home to the World Economic Forum’s Latin American Center for the Fourth Industrial Revolution, an initiative that aims to foster public policies that will allow AI and other technologies to flourish.

“Medellin is committed to becoming a knowledge-based economy,” Ospina said. “Public and private enterprises, as well as academic institutions are all working together.”

However, more needs to be done to develop human capital, even in dynamic Medellin.

“We want to be a hub for AI talent. But we think that we need to move faster than we are now,” Ospina said. “We are trying to educate and train people in these technologies because if they keep studying traditional [subjects], they are going to face a serious threat to their jobs in the near future… The technology is here and it is not going to disappear. The fourth industrial revolution is already here.”

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Stephen Woodman

Stephen Woodman is an independent journalist based in the Mexican city of Guadalajara. He has six years’ experience covering business and culture in Latin America. Stephen has been published in numerous international media outlets, including The Financial Times, BBC News and Reuters. To share story ideas, drop him a note here

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