Digital Landscape: Government Initiatives Fuel Digital Growth in Latin America

Latin America making rapid progress in mobile broadband connectivity

Latin American governments have tasted success in extending mobile coverage across countries. The region had the fastest growth in wireless broadband subscriptions over 2011-2016. While the voice segment is nearing saturation is some markets, operators have continued to invest in 4G LTE.

Competition and national broadband projects drive digital access

Historically telecom monopolies have been dominant in Latin America, which has negatively impacted digital penetration. In recent years, authorities have taken steps to curtail the dominance of operators such as America Movil. This, along with national broadband projects, is pushing digital connectivity.

Digital commerce and social media present growth opportunities

Despite a strong cash culture and relatively low card penetration, digital commerce will post healthy growth due to higher smartphone usage and the convenience of online purchases. Social networking is extremely popular with brands increasingly engaging consumers on social media.

Income inequality and online security concerns pose challenges

Latin America’s income divide will persist despite social schemes to address this problem. Income inequality will affect digital penetration among poorer consumers. Concerns surrounding online security also will be a key deterrent for digital growth, especially among first-time internet users.

Brazil, Argentina and Colombia are markets to watch during the forecast period

Brazil will post robust digital commerce growth due to rising demand for competitively-priced products. Colombia is making progress in enhancing digital connectivity while Argentina will record the biggest jump in the Digital Connectivity Index rank among regional peers over the forecast period.