Brazil sees increase in creation of IT companies

The sector is experiencing growth despite election-related instability.

There was an increase in the creation of companies active in the information technology sector in Brazil, according to a recent study.

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Some 13,900 IT companies started their activities in 2017, according to the study by consulting firm Neoway, a 17 percent increase on the prior year. The study also reveals that the number of liquidations in the sector saw a 43 percent decrease.

The numbers from the report, which was based on numbers from the National Database of Economic Activity, support other recent studies suggesting that the Brazilian IT sector has had some positive forecasts despite the recent downturn and the instability prompted by next month's elections.

Local investment in hardware, software and IT services saw a 4.5 percent increase, reaching $38 billion in 2017, according to a separate study released by the Brazilian Association of Software Companies (ABES). Another report by analyst IDC suggests that the Brazilian IT market could reach 5.8 percent growth in 2018.

According to the Neoway study, there are 195,000 IT companies in Brazil, of which 69,3 percent are based in the Southeast region, where the cities of São Paulo and Rio de Janeiro are located.

The Southeast region also concentrates about 75 percent of the income generated in the sector nationwide, according to the study.