Colombia’s IT, Software Exports Surge, But Tariffs Bite Into Revenues

42 Colombian tech companies are participating in Mobile World Congress in Barcelona, the country’s largest ever representation

An attendee uses an Oculus VR Inc. virtual reality headset on the second day of Mobile World Congress in Barcelona, Spain, on Tuesday March 1, 2022
March 03, 2022 | 11:20 AM

Bogotá — Colombia’s IT services industry has enjoyed an estimated 24.5% cumulative growth since 2010, and the sector currently contributes 2.9% to the country’s GDP, according to a report by the Colombian Software and IT Industry Federation (Fedesoft).

Fedesoft’s executive president Ximena Duque presented the sector’s results report at the Mobile World Congress in Barcelona, which runs until Thursday, with some 1,500 exhibitors and 60,000 visitors in attendance.

Fedesoft, which takes figures from the Ministry of Commerce, Industry and Tourism, said the software and IT services sector in Colombia recorded exports worth $218.8 million in 2021, 33% more than in 2020.

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Among the main buyers of Colombian IT products are markets such as Uruguay, the United States, Panama, Costa Rica and Mexico.

Fedesoft also stated that Colombia’s IT industry is made up of 11,101 companies, and which contribute 15% of the country’s service exports, while those companies sales are estimated at $29 billion.

“The figure may be higher if it is taken into account that companies in this sector in Colombia take advantage of different legal vehicles for their exports, and which are often not taken into account in the indicators,” details the guild.

It is estimated that 68% of the companies affiliated to Fedesoft export to countries such as the United States (33%), Ecuador (14.1%) and Mexico (8.3%).

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A person with a virtual reality headset on the second day of the Mobile World Congress in Barcelona, on March 1, 2022. dfd

However, the industry faces several obstacles, “such as cross-border tariffs on exports, as 48% of the revenues from IT sales abroad are retained, and which is really limiting their revenues by half”, Duque said.

According to government figures, the combined exports of knowledge-based services, including BPO, software and IT services and audiovisual production, exceeded $800 million in 2021, a growth of 43% compared to 2020.

According to investment promotion agency Procolombia, the country will this year have its largest participation to date at the Mobile World Congress, with the attendance of 42 technology companies.

ProColombia president Flavia Santoro said the event in Barcelona will allow the country’s IT industry “to continue leveraging those exports of knowledge-based services”.

“Colombia is already recognized as a trusted supplier in software, IT and digital marketing, thanks to aspects such as the talent, creativity and innovation of Colombian developers,” she said.

Colombian companies present at the event include Adsmovil, BlueSoft, Brand Studio and Ceiba Software, among others.

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