Latin American IT Investment Expected To Grow 10.9% In 2010

Total spending in information technology, or IT, in Latin America is expected to grow 10.9% to $260.6 billion, nearly three times faster than forecast expenditures at the global level, this year, according to information technology research company Gartner Inc (IT).

As Latin America booms, with countries such as Brazil expected to grow over 7%, Peru forecast to expand 6.6% and Chile anticipated to increase at least 5% for the year, investments in IT are following suit.

Meanwhile, worldwide IT spending is anticipated to increase at a more modest pace of 3.9% to $3.350 trillion this year.

Increased expenditures in IT usually go hand-in-hand with economic development, as the investments help boost productivity and allow for value added knowledge-based workers.

As the number of companies expanding regionally in Latin America grows, so does the number tapping into a relatively new technology called virtualization, which improves computer efficiency by allowing multiple systems to operate on one computer.

In the Latin American IT sector, investments in computer virtualization is forecast to jump 30% to more than 30,000 servers virtualized this year, Lidice Fernandez, director of consulting group IDC Latin America, said recently.

"Although server virtualization spending declined during 2009 due to the economic slowdown ... the number of new servers being virtualized in Latin America increased 8% during the period," she added.

U.S. computer virtualization provider Citrix Systems Inc. (CTXS), for example, anticipates 30% annual revenue growth every year over the next five years in Latin America and the Caribbean.

Citrix, one of the industry's biggest players, saw revenue in the Americas, which compromises the U.S., Canada and Latin America, grow 17% to $203 million in the second quarter on the year.

Meanwhile, in Latin America and the Caribbean, which represent about 5% of Citrix's total sales, revenue surged 70% for the same period, Enrique Pla, the company's VP for the region, told Dow Jones Newswires.

Overall, expenditures in IT in Latin America are expected to continue expanding as the prospects for economic growth look optimistic.

For 2014, spending in IT in the region is anticipated to grow to $326.1 billion, a 38.8% jump compared to 2009.

-By Anthony Esposito, Dow Jones Newswires; 56-2-715-8929; anthony.esposito@dowjones.com

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