Group Projects

Networked Economy

James Wong | Weny Isawati | Chad Rissman | Gregg Davison

The readiness of Brazil and Argentina in the networked economy framework is determined by their participation in the networked world with their businesses and government involvement in employing information and communication technologies. Brazil possesses large and well-developed agricultural, mining, manufacturing, and service sectors, which outweighs other South American countries and expands itself in world markets. After real wages fell from 2001 lasted until 2003, Brazil's economy grew only 1.1% per year. Likewise, Argentina promotes rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial sector. However, Argentina's economic growth suffers with the growth of -0.8% in 2000. Their economic problems lead to currency devaluation. With the above background, both of Brazil and Argentina offer unique ICT Employment Opportunities, B2C and B2B electronic commerce, and E-Government, opportunities and challenges.

ICT Employment Opportunities - Stage 3(Brazil) Stages 2(Argentina)
The current IT market in Argentina, which is the third largest in Latin America, causes shortages of local opportunities. ICT professionals have to look elsewhere for jobs or work for a local firm at lower wages. U.S. companies are cutting costs, which reduce outsourcing opportunities in Argentina and there are declining outlets for IT professionals to find jobs in the US. Argentina's ICT opportunities started to decline after the fall of the dot-com market in 2000. Based on the fact that ICT professionals are in abundance, but must find work elsewhere, categorizes Argentina at Stage 2 of the Networked Economy Framework for ICT Employment Opportunities. However, the need for them is growing. The education level in Argentina is ranked higher than Brazil and has a smaller population, thus, there is a better opportunity for Argentina to move up the framework at a faster rate. The Brazilian workforce has an adequate education system at its foundation. There are many skilled workers and a growing number of technology, engineering and science professionals. Although the country has many issues that are pressing which will damage the productivity of the workforce, such as poverty and infrastructure problems, there are many things advantageous as well. According to Ben Goertzel, CEO of Biomind LLC, a bioinformatics company in Silver Spring, Md., he stated that "Brazil comprises highly skilled IT professionals, a tradition of high quality software engineering, and a relatively short flight time from the U.S. East coast to hold in-person meetings several times annually. The fact is the economy kills the IT industry for those who are highly skilled. They long for greener pastures." In conclusion, Brazil has characteristics of Stage 3 and part of Stage 4 in the framework because of the centralization of the information and communication technologies in many local organizations and a large employment of local IT professionals by other countries.

B2C Electronic Commerce - Stage 3(Brazil) Stage 4(Argentina)
Despite having an enormous division among the rich and the poor, Brazil seems to be in a positive situation in regards to B2C electronic commerce. The Brazilian Government realized that liberalization towards investments and trade could help the country's economical growth in particular areas, including e-commerce and its e-commerce opportunities develop tremendously. Additionally, Brazil removed restrictions on foreign direct investments that attracted foreign investors. Many businesses throughout the country as a whole do not have the resources to incorporate the World Wide Web into their sales, marketing and customer service systems. Throughout the visit, excluding CDI, all of the companies we visited were large companies with access to many resources to perform business online. There was an unnoticeable difference between these companies in Brazil in comparison to companies in the U.S. and Europe. According to statistics from the International Telecommunication Union (ITU), Argentina has over 4 million Internet users, which represents about 33% of Internet users throughout the country. Argentina is one of the dot-com leaders of Latin America with the number of Argentine Internet start-ups is higher than in most of the region and the e-commerce business is booming.

B2B Electronic Commerce - Stage 4(Brazil) Stage 4(Argentina)
Both Brazil and Argentina seem to be progressing in creating and maintaining B2B electronic commerce. Both countries are taking a huge advantage of B2B business domestically as well as internationally. According to the Yankee Group, Latin American companies will conduct $63.8 billion of online business-to-business transactions by 2005. This enormous number is the result of a couple of main developments that include the arrival of increased bandwidth and the purchase of more sophisticated computers throughout smaller companies. Additionally, Brazil's liberalization has strengthened the trade links between international supply chains for many different industries. Both countries lean towards stage 4 than stage 3 due to the huge gap between some parts of the country.

E-Government - Stage 3(Brazil) Stage 3(Argentina)
Argentina was at Stage 3 because they primarily use the government website for informational purposes. The assumption was based on Buenos Aires' government website, which offers notifications, city activities, city services, contacts, city news, and travel information. The website does not provide any online commerce transactions. Likewise, Brazil's government websites for the cities of Sao Paulo and Rio de Janeiro are mainly for local information and news. Thus, Brazil is positioned at Stage 3 in the framework. Both countries have the resources to invest or create more advanced websites to provide a wide range of services including payment transactions.