The business of outsourcing has been growing for decades now driven by strategies to reduce costs, generate economies of scale, and focus on core competencies, it’s clear that IT and business process outsourcing work. India has stood out as the pre-eminent force in this process; but in practice most global companies and offshore service providers are looking to spread their facilities and investments on a global basis, rather than in just one location.

Geographically, Brazil’s proximity to the US makes it distinctly more accessible than more distant Asian locations. It therefore qualifies as a “nearshore” location for the US market, along with Canada and various Caribbean countries. With a population of 182 million growing at 1.1% per year, Brazil has an estimated educated workforce of 83 million. The country clearly has a substantial labor pool, potentially a major strength when many offshore locations are rapidly “overheating. Brazil is cheaper than almost all other South American or European countries, with a 30% salary advantage cost over the US. However it is not the cheapest option due to Indian locations benefiting for an additional 30% cost advantage. The average salary for an “entry level” IT worker is about $9,000, while in China and India it’s about $5,500.In the only South American Portuguese speaking country, English is only modestly spoken. The Spanish language gets bigger play, but nothing compared to its native Spanish speaking neighbors Uruguay, Argentina, Chile and Mexico, which are also taking part in this competition. Economically, Brazil has evolved a lot since the days of 2,000% inflation. Today the economy is stable, with a 6% inflation rate reported at the end of 2005. The IT sector itself is a well developed $10 billion market, with an $8.3 billion multinational presence.