Latin America IT Spending Expected To Recover In 2024

Information technology (IT) spending in Latin America will be among the last global regions to return to pre-Covid levels, according to analyst firm Gartner.

Global spending on information technology will reach $4.1 trillion in 2021, an increase of 8.4% on 2020. On a regional basis, Latin America is expected to recover in 2024, while Greater China has already exceeded IT spending levels in 2019. North America and Western Europe are expected to recover by the end of 2021.

"Last year, IT spending took the form of a 'knee jerk' reaction to enable a remote workforce in a matter of weeks", said said John-David Lovelock, distinguished research vice president at Gartner. "As hybrid work takes hold, CIOs will focus on spending that enables innovation, not just task completion."

According to Gartner, the increased focus on employee experience and well-being will drive technology investments forward in areas such as social software and collaboration platforms and human capital management software.

A separate study published earlier this year by research firm IDC predicts that in Brazil, the largest IT and communications market in Latin America, growth is expected to reach 7% reaching US$ 64,4 billion in 2021, with security and public cloud among key areas of focus.

Buyers are currently a lot more confident about ICT investments in Brazil, with 50% of companies planning to increase spend in 2021. That boost in confidence follows a dramatic change in plans seen last year: about 60% of Brazilian user organizations had been planning to increase their ICT spend at the start of 2020, but the pandemic meant intentions to boost investments plummeted to a record low in May and June.

According to IDC's predictions, other key areas where Brazilian companies will be increasing spend are artificial intelligence, modernization of enterprise software and customer experience. These investments are expected to increase productivity, and reduce costs.