Latin America Digital Transformation Market Size

Latin America Digital Transformation Market Analysis

The Latin America Digital Transformation Market size is estimated at USD 91.11 billion in 2024, and is expected to reach USD 205.67 billion by 2029, growing at a CAGR of 17.69% during the forecast period (2024-2029).

• With the introduction of Industry 4.0 in the manufacturing sector, numerous factories are embracing digital technology to improve, automate, and upgrade the whole process. Industry 4.0 technology, such as robotization, is already commonplace in many enterprises. For example, in April 2023, Telit Cinterion, a global facilitator of the intelligent edge, announced the completion of a successful proof-of-concept trial of private 5G for factory automation. In partnership with Nestlé Brazil, the trial showcased why and how manufacturers increasingly make 5G a foundational component of their Industry 4.0 transformation strategies. Many manufacturers are considering or already implementing 5G, including private 5G networks, a global trend that will be worth USD 109 billion by 2030.
• As per IFR, the Brazilian automotive industry is the foremost adopter of industrial robots, with 47% of operational robots and 22% of new installations recently. This capability enables the automotive industry to maintain its position as one of the most significant users of robots and possess one of the most automated supply chains globally. Intelligent robots work alongside humans and can be trained by most production workers to execute the most common, time-consuming jobs and deliver them properly.
• Furthermore, the increasing use of IoT devices in companies is predicted to accelerate digital transformation in various industries. According to GSMA, the number of Internet of Things (IoT) connections in Latin America was expected to increase up to 1.2 billion by 2025. By that time, IoT was projected to generate over USD 47 billion in revenue in the region.
• As AI and deep learning applications expand in the region, from tech giants to small and medium-sized businesses, there has been a shortage of expert AI technicians. Without talent, these increased investments in artificial intelligence and machine learning could be wasted, leading to financial losses and unrealized opportunities.
• However, the adoption of cloud technologies in digital transformation presents challenges related to data storage and security. Organizations need to carefully assess cloud service providers, implement encryption techniques, and establish data access controls to protect sensitive information stored in the cloud. For instnace, in the 2024 General Counsel Report, which surveyed chief legal officers in Latin America and globally, 43% of respondents indicated that their data privacy risks had been impacted by remote and hybrid work setups.