How Bolivia is Becoming a Nearshore Outsourcing Tech Hub Worth Noticing

bolivia nearshore outsourcing

Countries need a strong digital core to affirm their global competitiveness, increase their Gross Domestic Product (GDP), promote innovation and create new jobs. Despite getting off to a slow start in this matter, science and technology in Bolivia have experienced outstanding growth in the last few years, turning into a rather unexpected hub in the region.

When it comes to technology in Bolivia, growth was a key stepping stone for the authorities. The last governments have advanced the country greatly, not only in regards to technology, but also at a social and economic level. In fact, according to recent official statistics, in the last 13 years Bolivia has:

  • Reduced poverty levels in half, from 38.2% (2005) to 15.2% (2018).
  • Reduced inequality. The income share of the top 10% was 128 times higher than the poorest 10% portion of the country in 2006. In 2018, the number is significantly lower: 26 times higher.
  • Increased the country’s GDP by 5%.
  • Reduced illiteracy by more than 10%, mainly due to a national program, “Yes, I can” (Yo sí puedo).

Connectivity

Bolivia has also experienced immense growth when it comes to connectivity: the National Telecommunications Company (Entel) has already installed almost 12,000 miles of fiber optics in the country, reaching the entire territory by mid 2019.

Additionally, in 2020 internet connections reached 10.8 million, over 415,000 more than in 2019 (4%). The areas with the highest number of connections are La Paz, Santa Cruz and Cochabamba.In 2019, Entel  launched a mobile wallet.

In 2021 Entel modernized mobile communication networks in rural areas, from 2g to 4g and LTE, providing better and faster internet connections to more 700,000 users and is investing 17.7 million dollars to continue to improve connections in more than 100 localities in the country.

Technological Advances & Investment

In the last few years, Bolivia has strived to become a technology pole in the region, investing heavily in both local companies and in IT education. Some of the most notable efforts to earn this position are:

Tech Hubs

Through institutions such as Bolivia Tech Hub and Hub Santa Cruz, technology in Bolivia is becoming increasingly better. The country is improving access to education and business opportunities in science and technology, hosting not only incubators and accelerators for entrepreneurs, but also providing spaces for young people to develop their skills and learn about trends in the industry such as artificial intelligence.

6B Labs, located in Santa Cruz, is another key part in local entrepreneur growth. This innovative incubator provides Bolivian entrepreneurs with the opportunity of building global fintech, crypto, blockchain, e-commerce, mobile apps or Saas companies in only three months.

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Credit: Bolivia Tech Hub

The country has more than 20,700 companies that provide products or services related to the Communications and Information Technologies (2017). When it comes to programming and computing, there are almost 3,000 companies registered (2017), twice the number registered in 2011. These companies are mainly operational in La Paz, Santa Cruz and Cochabamba, while the remaining 12% are located in the rest of the country.

According to the 2020 “The Digital Economy Situation in Bolivia” report, the country has six state institutions dedicated to providing direct national and local support to tech companies, as well as 27 coworking spaces, three tech incubators and four tech accelerators.

Free zones are also major players when it comes to attracting foreign investment capital, promoting technology transfer and creating development poles. Currently, Bolivia has several different industrial and commercial free zones, including Zofwin and Zoframaq, both located in Santa Cruz, Zofray in Yacuiba, Zofro in Potosí, in Santa Cruz, Zofracobija in Pando, La Paz Free Commercial and Industrial Zone in the capital of Bolivia and Zofrapat in Patacamaya, La Paz.

Software Development

According to the Electronic Government and Information and Communication Technologies Agency (AGETIC), Cochabamba is the biggest software developer and exporter in the country (80% of programs are developed there), followed only by La Paz and Santa Cruz. Nowadays, more than 200 software developing companies annually export over 50 million dollars, mainly to the United States. Additionally, the number of nearshore programmers has increased notably in the past few years.

The biggest software group in the country is Jala, founded in 2001 by Jorge López. It has over 600 engineers, and commercializes its products all over the continent. The number of independent software developers that currently operate from Bolivia and outsource their skills to other countries has also grown notably in the last few years.

Some of the reasons why Bolivian software development has become extremely popular overseas and why many locals have chosen to become nearshore programmers ,are: the fact that the country is in the same time zone as the U.S., which simplifies transactions and delivery dates, the quality of the software produced locally and cheaper labor costs.

Mobile Banking, Financial Investment and Billing

For the past three years, Bolivia has hosted the Digital Bank, one of the most important advanced technology events of Latin America, where some of the most innovative solutions in mobile payments, e-wallets and financial inclusion are discussed.

When it comes to billing, 83% of the more than 400 million bills issued in the country are processed electronically, and this number is expected to reach 100% in the next year. In 2020, the electronic bill system was improved to simplify the operational process in light of the pandemic.

In terms of investment, Bolivia has increased its financial digital investment by 3% between 2017 and 2018 (from 8.67% to 11.67%), becoming the third Latin American country with the highest investment rates in this industry, preceded only by Panama and Argentina.

According to Microsoft’s first female manager in Bolivia, Dunia Bravo, the country is an early adopter of technology and a less complex digital infrastructure due to the lack of massive corporations, which can definitely help the market grow.

Bolivia’s Hottest Technopoles

Photo: Cochabamba, Bolivia

  • La Paz (1.9 million inhabitants): Bolivia’s capital is considered the main technological city in the country. It has the most modern infrastructure, with more than 60 miles of fiber optics lines that connect 60 of the city’s main municipalities. It is also home to one of the most important software development companies in the country, Coderoad-Mojix.
  • Santa Cruz (2.1 million inhabitants): Santa Cruz is the most populated city as well as the city with the largest economic growth in Bolivia. Home to more than 20 universities, both private and public, as well as to several software development companies and local and international conferences, Santa Cruz has embraced the technological revolution.
  • Cochabamba (1.75 million inhabitants): Bolivia’s crown jewel, Cochabamba is responsible for 80% of the local software development as well as the home of the most important software development company in the country, Jalasoft.

Education

Not only is doing business in Bolivia a good option for companies because of the welcoming ecosystem, but also because of its top talent. It is the second Latin American country with the highest investment rates in education. The government has spent over 300,000 dollars to develop science and technology education in the country and has created almost 130 new tech institutions in the past 11 years, equipped with cutting-edge technology, some of which are located in the more remote areas of the country.

As stated by the director of the Nuclear Energy Bolivian Agency (ABEN) to local site Prensa Latina, Hortensia Jiménez, the government is working towards achieving scientific and technological autonomy, because ultimately “knowledge is freedom”.

As stated in the 2025 Agenda, the country needs to expand on innovation, knowledge and technology in Bolivia,  in the strategic, product and services areas to complement modern science with their traditional skills, social and professional creativity and technical and technological wealth.

A growing number of students are interested in software developing and technological innovations in the field of information and communications in the country. Robotics has become an area especially attractive for young people, who organize hackathons, participate in science clubs and are constantly exploring the world of apps.

Local Universities with IT and Graduate Degrees

Nowadays, 36 private universities, 11 public universities, three indigenous universities and three universities with special teaching regulations offer degrees and masters in the country.

Bolivia has a solid infrastructure and an excellent university system and offers a wide array of careers related to computer science and IT.  Just in Santa Cruz, 9 universities offer 35 different degrees in Engineering, 11 of which are offered by the Universidad Autónoma Gabriel René Moreno (Uagrm), among which is electromechanics, one of the most complex types of engineering in the market. Moreover, in Santa Cruz at least one third of college students currently study engineering (out of 30,000 students overall).

The most popular university nowadays in the country, mainly due to its academic offer is the Universidad Boliviana, a consortium of private and eight public universities located in several cities in the country, including La Paz, Cochabamba, Santa Cruz, Sucre, Tarija and Trinidad.

When it comes to engineering and computer science, one of the highest regarded institutions is the Universidad San Francisco Xavier de Chuquisaca. It provides specific careers in Engineering and Agriculture.

Because IT graduates are extremely sought after by local and international companies, scholarships have become more abundant. Not only do the universities themselves provide partial and full scholarships, but also students can apply to international scholarships provided by institutions such as the Organization of American States (OAS), the Women’s Rights Program (for women interested in pursuing IT careers), EuroInkaNet, UNESCO or the World Bank.

English Proficiency

Although Spanish is the official language of Bolivia, English has become particularly popular among IT students, especially due to the fact technical textbooks and exams are only in English. English is also the most popular language among the IT workforce and key to work overseas or in international tech corporations.

According to the EF English Proficiency Index (EF EPI) 2020, Bolivia is among the top 10 countries in Latin America with the highest level of English above countries such as Peru and Mexico.

Flight Connectivity

Bolivia has four international airports located in its main cities for software development, providing foreign executives and investors with great access to flights. International airports offer connecting flights with over 20 local airports as well.

  • Flight time from L.A to La Paz: 12 h
  • Flight time from N.Y to La Paz:  11 h 30 min
  • Flight time from Miami to La Paz: 9 h 10 min
  • Flight time from Miami to Cochabamba: 15 h 45 min
  • Flight time from N.Y to Cochabamba: 15 h 52 min

Time Zone

Bolivia’s official world time zone is GMT-4, exactly the same as New York and Miami, and only three hours ahead of Los Angeles (GMT-7), providing the perfect scenario for international, real-time collaboration.

Holidays and mandatory leave days

According to local labor laws, Bolivian employees are entitled to 15 days of mandatory vacation per year. In terms of national holidays, Bolivians enjoy 11 days, and in some cases, an additional 9 public holidays, celebrated in specific states throughout the country.

An Emerging Tech Hub in South America

Despite the fact that Bolivia is a very traditional country, in the last few years it has begun to exploit its potential in several areas, particularly in engineering and computer science, strengthening their education and professional capacities.

Overall, doing business in Bolivia is becoming a significantly attractive option for several countries in the region. Furthermore, because of several international agreements to develop software, such as with India, its appeal will only continue to grow and the number of nearshore programmers will increase.