Transcript Program for the Development of the Software Industry (PROSOFT)

Program for the
Development of the
Software Industry,
PROSOFT
Sergio Carrera Riva Palacio
Director General of Domestic Commerce and
Digital Economy
Ministry of the Economy
Government of Mexico
Mexico’s Economy Overview
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Total population: 104 million
GDP: 625 BUSD (world’s 10th economy)
U.S. second trade partner (Canada 1st)
Largest FTA’s network worldwide (including NAFTA,
EU, and Japan)
4th country in number of airports and 1st in daily
flights to and from the U.S.
7th exporting economy
Ranked 5th in per-capita foreign direct investment
received
Largest spanish speaking population (U.S. – 5th)
Best country in Latin America in terms of
technological accomplishment, according to the
UN
PROSOFT
Mexico’s IT industry policy
Goals (2013)
 To accomplish an IT services annual production level
of 15 billion USD
 To reach the OECD’s average IT expenditure as an
economy
 To position Mexico as the leading IT powerhouse in
Latin America
PROSOFT – Mexico’s IT industry policy
Strategies
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Promotion of exports and investments in the sector
Enhancement of human capital capabilities
Adequation of the digital economy legal
framework
Development of the IT domestic market
Stregthening of the local industry
Achievement of world class process capabilities
Promote cluster development countrywide
State governments participating in
PROSOFT
Aguascalientes
Baja California
Guanajuato
Jalisco
Morelos
Nuevo León
Puebla
Sinaloa
Sonora
Yucatán
Mexico’s ITES industry value offer
 Human capital
 Highest IT undergraduate level workforce in Latin America
(+100,000)
 30% of current undergraduate total enrollment in IT related
fields
 Abundant non-IT undergraduate level workforce for BPO
and call centers available nationwide (lawyers, BA’s,
CPA’s, HR)
 Infrastructure
 Broadband services available nationwide
 World class telecommunications services in main cities
 Sectoral experience for multinationals
 Manufacture
 Financial services
 Government
 Telecommunications
Mexico’s ITES industry value offer
Total project cost
advantage
(nearshore approach)
•Reduced flight cost
and time compared to
the Asian region
•Enhanced productivity
in the solution of real
time problems
•Smaller amount of
professionals at
customer’s facilities
Quality and
process capabilites
•3 CMM-5, and +15
CMM-4 and 3
companies
(+53 currently
engaged in model
implementation and
assesment)
•ISO-9000 adoption
widely spread
Legal framework
•Electronic signature
and invoice
•Data protection and
privacy
•Intellectual property
rights
•In all cases, the
legal framework is
compatible with U.S.
legislation
Mexico’s ITES industry value offer
Country
Environment
•Political stability
•Low geopolitical risk
•NAFTA
(investment protection,
IPR, visas, market
access)
•Preferential market
access with the U.S.,
Canada, EU, Japan,
and Latin America
Cultural
Affinity
•Compatible business
environment and legal
framework
•Deep knowledge of
the American
consumer
•Direct access to the
U.S. Hispanic market
PROSOFT support for export oriented
companies
Cash grants on
a 50% basis
of total costs for:
 Manpower training and
certification
 Software & equipment
 Infrastructure
 Process implementation and
certification
 Standards certification
 Technology transfer and royalties
 Supplier development programs
 Education/training tailor-made
programs with universities
Additional grants from State governments apply
PROSOFT incentives for foreign
companies establishing ITES
operations in Mexico
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The same type of cash grants given to export
oriented companies apply
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Tax breaks for R&D activities
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Local governments incentives (availability differs
from state to state):
1. Payroll & Estate tax exemption
2. Preferential rates for land acquisition or leasing.
3. Simplified red tape
PROSOFT grants – Sep/Dic 04
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Companies qualified for grants:
 95 companies engaged in improving
their process capabilities
 +1,200 IT professionals engaged in
training and certifications
 + 200 professionals engaged in PMI
training and certification
 5 facilities for operations in
embedded software, semiconductor &
hardware design, and multimedia
content development supported
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Projects supported
Cash grants
worth 20 milion USD
Concluding remarks
1. Mexico’s ITES value offer has
advantages over other options:
2. Mexico’s workforce pool for BPO
activities is abundant and readily
available nationwide
3. Mexico’s IT industry has extensive
experience working with
U.S. based companies
Nearshore approach
Compatible legal framework and
business environment
Political stability
Competitive total project cost
Tailor-made programs to develop
supplier capabilities
Program for the
Development of the
Software Industry,
PROSOFT
Sergio Carrera Riva Palacio
Director General of Domestic Commerce and
Digital Economy
Ministry of the Economy
Government of Mexico