TOP IOO LATIN AMERICAN INTEGRATORS AV INDUSTRY • REPORT 2021-2022 by Latin Press, Inc.

AV Industry Outlook in Latin America 2021 - 2022

REPORT

2021-2022 KEY ASPECTS OF THE AV INDUSTRY RANKING TOP 100 INTEGRATORS

SECTORS AND COMPANIES FACING COVID-19: IMPACT ON THE INDUSTRY RISE IN FREIGHT PRICES. WHY? GROWTH OF DIGITAL EDUCATION, GREATER SUPPLY, AND DEMAND FOR AV TELECOMMUTING AND TELEHEALTH: EXPANSION OPPORTUNITIES FOR AV

© Latin Press, Inc., 2021 All rights reserved. No part of this work may be reproduced or incorporated into a computer system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the prior written permission of the copyright holders. Infringement of such rights may constitute an intellectual property offense. Original title: TOP 100 Latin American Integrators AV Industry Report 2021-2022. 3rd edition: November 2021 Research and writing: Andrea Ochoa Restrepo Editorial Direction: Duván Chaverra Layout: Jhonnatan Martínez Avalo Graphics: Jhonnatan Martínez Avalo Cover Photos: Pixabay

Table of contents Top 100 integrators in Latin America: How is it done? ............................................. 6 Introduction........................................................................................................................................................8 Chapter 1: Key aspects of the AV industry.................................................................................... 13 Use and classification of AV technologies ..........................................................................................................13 Segments with more projects.............................................................................................................................14 Most used brands................................................................................................................................................16 AV imports by region and company...................................................................................................................19 AV imports by country of origin..........................................................................................................................21 Comparison of growth by segment....................................................................................................................22

Chapter 2: Integrators’ Perspectives ............................................................................................ 24 Mexico.................................................................................................................................................................25 Central America..................................................................................................................................................30 Andean Region ...................................................................................................................................................32 Southern Cone....................................................................................................................................................36 Perspectives of AV Consultants-Integrators ......................................................................................................42 A comprehensive view of the AV industry from academia.................................................................................46

Chapter 3: Ranking Top 100 Integrators 2021.............................................................................. 50 Mexico.................................................................................................................................................................52 Central America..................................................................................................................................................54 Andean Region ...................................................................................................................................................56 Brazil....................................................................................................................................................................58 Southern Cone....................................................................................................................................................60

Chapter 4: Rising freight and cargo prices - why?........................................................................ 62 Chapter 5: Growth of digital education, increased supply and demand for AV......................... 66 AV constraints and barriers to access to digital education.................................................................................69 Overview of the use of AV tools in the education sector on a country-by-country basis...................................71

Chapter 6: Sectors and companies facing COVID-19: impact on the AV industry...................... 88 Productive structure: external and internal gap in the region and its effects after the pandemic.....................91 Comparison between Latin America and the European Union: relative internal productivity...........................92 Impact of covid-19 on the different segments of AV projects in Latin America ................................................93

Chapter 7: Overview of Latin American economies (pandemic-post-pandemic)...................... 100 Financial Markets Volatility Index......................................................................................................................101 Emerging Markets Bond Index 2020................................................................................................................102 Year-on-year rate of change in world trade volume..........................................................................................104 GDP growth in Latin America...........................................................................................................................106 Expenditure growth by component in Latin America .....................................................................................106 Perspectivas futuras..........................................................................................................................................107 Inflation expectations 2020 and 2021...............................................................................................................109 Impact on the level of investment and capital flows in relation to financial market risk within the AV industry........................................................................................................................................................110 Infographics: Exports and trade balance Mexico and Central America 2020..................................................111

TOP IOO INTEGRATORS • REPORT 2021- 2022

Table of contents Mexico, Central America and the Caribbean...................................................................................................112 Infographic: Exports and trade balance South America 2020..........................................................................119 Andean Region..................................................................................................................................................120 Southern Cone..................................................................................................................................................124

Chapter 8: Telework and Telehealth: expansion opportunities for AV in Latin America......................130 Telework and access to technology tools and AV ............................................................................................133 AV integration systems for Telehealth .............................................................................................................135 Technology trends in videoconferencing systems ...........................................................................................138 Growth of residential automation ....................................................................................................................139

Index of references..........................................................................................................................................140

TOP IOO INTEGRATORS • REPORT 2021- 2022

Top 100 integrators most recognized in Latin America: How is it done? AVI LATINOAMÉRICA, wanted to highlight again in 2021 the work of integrators in the region for the growth of the industry, so we took on the task of making, for the seventh time, the Top 100 integrators with greater RECOGNITION in Latin America. The RECOGNITION ranking was born as an initiative that has also been successfully carried out by other international economic media, which, through information collected on each company and a vote, highlight some of the most important companies in the region or in the countries. Each year we consult several sectors, including manufacturers, distributors, as well as the bulk of our readers (consultants, technicians, end users, operators, among others) throughout our Latin American region, who, in the end, was in charge of legitimize this work and contributing to the recognition of these companies. It is therefore important to highlight the methodology implemented for this report a complete compilation of information was made in order to consolidate a list of 100 of the most outstanding companies in Latin America, divided into four sub-regions (Mexico, Central America, and the Caribbean, the Andean Region and the Southern Cone). For this point it took into account the nomination made by manu-

facturers and distributors of many of the most prestigious brands in the field of air conditioning and refrigeration, as well as a detailed monitoring by the journalistic team of AVI LATINOAMÉRICA, relying on consultants and experts and professionals with extensive knowledge of the industry. Subsequently, through an online survey conducted with our readers, the 100 companies were ranked and placed in the ranking, divided into 20 companies from Mexico, 15 from Central America and the Caribbean, 25 from the Andean Region, 20 from Brazil and 20 more from the Southern Cone. This ranking and placement also took into account differential elements such as years of experience in the industry, certifications, number of employees, headquarters and membership in associations and/ or industry associations in the region. In other words, of the total percentage published in the ranking, 40% of the value is given to the number of votes obtained and the remaining 60% to the differential elements mentioned above. The list includes information on the segments served by each company and the percentage of recognition. You can also nominate your company by writing to editorial@avilatinoamerica.com

METHODOLOGY 1

COMPANY IDENTIFICATION AND APPLICATION

COLLECTION OF INFORMATION FROM COMPANIES

Mexico Central America Andean region Brazil Southern Cone

20 15 25 20 20

Years of the company Number of employees Company headquarters Associations and / or company Recognition survey done by readers of

15% 15% 15%

IOO COMPANIES

60%

15%

60% corresponds to differential elements of the company

VOTES RECOGNITION

RANKING AND / OR LOCATION OF COMMERCIAL INFORMATION ACCORDING TO THE ABOVE VARIABLES.

40% Appreciation survey done by AVI readers

40%

100%

TOP IOO INTEGRATORS • REPORT 2021- 2022 TOP IOO INTEGRADORES • INFORME-2019

Introduction The global economic outlook continued to weaken during the last two years as a consequence of the COVID-19 pandemic, the trade tensions between the United States and China, the confusing evolution of the European Union affected by Brexit, and the slowdown of the German economy as the increase in risk aversion in the financial markets, which is reflected in low levels of long-term interest rates in the bond market and the inversion of the yield curve. Thus, investment has been losing dynamism in the world despite liquidity and low-interest rates. This is directly related to the current level of uncertainty. In the face of these variables that have a considerable impact on the global economy, in 2020 the rupture in the agreement to cut OPEC+ crude oil production due to the oil war between Saudi Arabia and Russia was added, which together with the decreased world demand due to the Covid-19 implied a plunge for the Brent reference, which between March 6th and 9th of that year was 24%, which led to a certain quietness in the markets. These two shocks have generated fear in the financial markets and led to changes in international capital flows and exchange rate depreciation, especially in emerging economies. In 2020, the world economy experienced its worst economic contraction since the 1930s, due to the measures put in place by governments to deal with the SARS-CoV-2 pandemic (COVID-19). According to the United Nations Department of Economic and Social Affairs (UN DESA, 2021), the world economy will contract by 4.3% in 2020, 0.9 percentage points less than the forecast of -5.2% published in September 2020 which affected the industry AV, forcing many companies in the sector to transform their services. The current scenario also presents the following challenges for the industry mainly due to the economic and social circumstances that several Latin American countries are going through. However, as will

be seen in this report, Integrators have been able to sustain and move forward with their business, adapting to the new normal and facing the harsh measures imposed by governments to try to contain the pandemic, also facing market volatility, decreased demand, falling trade, capital flows, economic deficit, financial instability and investment risks because of the current situation. In addition, some companies in the industry, in the midst of the crisis, have created outstanding projects, which are taking into account digital development for education, telework and telehealth, which generates an increase in demand for services and equipment, key global trends in the industry, which strengthens sustainability, efficiency, and connectivity. In this sense, lgnacio Lucero, AV integrator considered that the market in the industry “is adapting to changes in customer demand post-pandemic and accelerated digital transformation that imposed. These changes have grown the demand for electronic components and semiconductors that are forcing customers to buy more in advance than before.” According to the Economic Balance of Latin America and the Caribbean prepared by the UN Economic Commission for Latin America and the Caribbean (ECLAC): “In terms of economic to growth, in the economies of South America, GDP fell in the first three quarters at a rate of -7.7% year-on-year, compared to a growth close to zero in the same period of the previous year. The economies of Central America went from 3.2% growth in the first three quarters of 2019 to a 5.9% contraction in the same period of 2020. If Central America and Mexico are taken into account, the drop in growth in the first three quarters of 2020 is 9.2%, a figure 9.6 percentage points lower than in the same period of 2019.” In sectoral terms, the current juncture has had a negative impact on all sectors with different intensity depending on the sector: the most affected are ma-

nufacturing, construction, commerce, and transport, and the least affected are agriculture, essential services, financial services, and mining. Against the backdrop of the pandemic, with global value chains disrupted and demand contracting sharply, world trade in goods and services fell sharply in the first half of 2020, with a nascent recovery in the second half. According to data provided at the beginning of 2021 by ECLAC, the volume of world trade in goods fell by around 9% in 2020, less than the plunge recorded in 2009 during the global financial crisis (-13%). This contraction caused by the arrival of COVID-19 follows a period of weakening international trade, which between 2010 and 2019 showed annual rates of expansion significantly lower than those reported in the years prior to the 2008-2009 global financial crisis.

Likewise, the exchange market has been concerned about the current account deficit caused by the decrease in exports. However, for ECLAC, the region’s current account deficit will decrease significantly (to 0.4% of GDP from 1.8% of GDP in 2019) due to the strong contraction of imports. A 14% reduction in volume terms is expected. The value of the region’s exports would contract by 13%. Export prices would fall by 7% and export volumes by 6%. In order to mitigate exchange rate volatility, the region’s central banks have adopted various exchange rate measures, including greater intervention in the markets, through the purchase or sale of foreign currency, but also through regulations to regulate financial flows. In countries such as Brazil, Chile, Colombia, the Dominican Republic, Guatemala, Jamaica, Mexico, Peru, and the Dominican Republic, an

Rate of change in the volume of world trade, 2005-2020 (Percentages) 25 20

-15

-25

2020

2019 -0,5%

-10

-20

2019

2018

2016

2015

2014

2012

2011

2010

2009

2008

2007

2006

-5

2005

5 0

January 2017 to December 2018 4.1%

July 2011 to December 2016 2.0%

2013

2017

January 2005 to June 2007 7.6%

April - October 2020 -12.7%

January 2005 to June 2007 -17.2%

Note: The 2020 figures correspond to the average year-on-year change for the first 10 months. The red and green horizontal lines correspond to the average annual growth for the period. Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on figures from the Netherlands Bureau of Economic Policy Analysis (CPB) [online] www.cpb.nl. TOP IOO INTEGRATORS • REPORT 2021- 2022

increase in the amounts allocated to foreign exchange market interventions have been announced, as well as a broadening of the horizon of such interventions. In addition, the authorities have used various instruments to provide liquidity in foreign currency, as forward contracts and swaps, which have a significant impact on the AV industry.

tuations. For ECLAC, most of the region’s currencies depreciated against the dollar, thus maintaining the trend observed in 2019. Thus, in the first ten months of 2020, 17 of the region’s economies recorded depreciations of their currencies against the dollar rate at the end of 2019, and the average depreciation was 16.3%.”

Similarly, fiscal policy has become the most important tool used by countries in the region to address the social and economic effects of the pandemic. This has been reflected in tax relief, public spending and liquidity measures for the productive sector, which have influenced the behavior of public accounts during 2020.

For 2021, forecasts made by ECLAC indicate financially conditions similar to those of the second half of 2020, in which countries have continued, in general, with access to financing on favorable terms.

The financial instability generated by the pandemic in international markets and the uncertainty about commodity markets led to strong exchange rate corrections and, in the first three quarters of 2020, the region’s currencies experienced considerable fluc-

But a worsening of the financial outlook for emerging countries involving a sudden stop to new financing or the renewal of previous financing could pose a major problem for many economies whose debt ratios have increased to cope with the pandemic. In addition, potential currency depreciations in the face of reduced risk appetite would put pressure

TARGET AUDIENCE • Entrepreneurs of the AV industry. • AV equipment manufacturers and distributors. • Market analysts and researchers. • Government and financial institutions. • Investors. • AV equipment end users.

especially on those countries with higher levels of foreign currency debt.

investment opportunities. Additionally, for 2021, the report addresses four new chapters: “Rising freight and cargo prices is the reason?”, “Growth of digital education, increased supply and demand for AV”, “Telework and Telehealth: expansion opportunities for AV in Latin America” and “Sectors and companies facing the COVID-19: impact on the AV industry”. It is also addressed the situation business and large-scale responses, the structure productive (external and internal productivity gaps in the region) and the differences in performance between the different segments. In addition, are analyzed the prospects and level of investment for the sector, country by country.

Notably, the report Top 100 Integrators AV in Latin America 2020-2021 analyzes how this economic outlook would impact the industry, country by country, from the perspective of integrators who are part of this Top 100 made by AVI LATINOAMÉRICA. It also addresses key industry information such as import figures made by companies in each country, the brands of equipment most used in the region, the segments with the highest investment in AV, even sales figures of several of the companies, along with detailed contact details about the companies that are part of the ranking of 2021 are also in this report.

Other key aspects of the AV industry are also developed, based on the growth of the market during the last year, originating from the acquisition of integrated and automation systems and the impact on tele-education and teleworking.

Readers will also learn a complete overview of the AV industry in Latin America, as well as comments and recommendations on technology trends and

MAIN SEGMENTS OF AV PROJECTS IN LATIN AMERICA 2021

12.0%

15.4%

16.3% 27.9% 8.4% 18.2%

COMMERCIAL CORPORATE EDUCATION AND GOVERMENT HOSPITAL AND PHARMA INDUSTRIAL RESIDENTIAL Source: Survey conducted on an online platform among TOP 100 AVI integrators through August 31, 2021.

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 1

STATE OF AV TECHNOLOGIES IN LATIN AMERICA When asked integrators how they would classify existing technologies in Audio, Video, and Automation, most agreed that technologies such as HDbaseT audio, AV over IP / Dante, VGA video, AV over IP, DryTouch Control are traditional technologies of greater use, which in turn are migrating to innovation as is the case AV over IP, Dante, Control by natural voice recognition and Projection. Interestingly, most integrators rated most of the “Innovative” technologies as “Future Trends”. Still, it highlights that integrators consider that the transmission of AV signal over IP is a technology “Innovative”, in contrast to the management services in the cloud, which they consider a “Future Trend”. They also emphasize that “analog technologies, physical media are already outdated and

obsolete, with the advent of the cloud, such technologies are no longer relevant. In addition, video resolutions lower than Full HD have their days numbered”. On the other hand, integrators added that: “The directional beam microphones will be used increasingly, mainly with the growth of work and hybrid teaching”. To which they added: “The use of audio and video over IP will also gain increasing strength in the coming years, is a system that compresses audio and video signals to be distributed through the IP protocol, allowing the same possibilities as a data signal”. On the automation side, integrators define that there will be substantial growth in scheduling solutions for rooms and desks integrated into the access control system.

STATE OF AV TECHNOLOGIES IN LATIN AMERICA AUDIO Analog audio

Amplifiers

Digital A/V

VIDEO AV over IP AV over IP / Dante

HDbaseT

VGA Analog Video

Projection

Lamp Projectors

LED Displays

AUTOMATION IOT and DIY equipment Plasma Screens

Natural voice recognition control

Analog Video

Control systems

Source: Survey conducted on an online platform among TOP 100 AVI integrators through August 31, 2021.

Dry contact control

Traditional

Obsolete

Innovative

Future Trends

TOP IOO INTEGRATORS • REPORT 2021- 2022

MAIN SEGMENTS OF AV PROJECTS IN 2020-2021 The most interesting change in market distribution in 2021 compared to 2019-2020 is in the corporate segment, which continues to dominate in the materialization of AV projects in areas such as the Andean region and the Southern Cone. For this year, there is also evidence of higher growth in the commercial segment for Mexico. In the case of Brazil, the segment with the highest growth is the industrial segment, which did not present any growth for 2019. It is worth noting that the corporate sector continues to present the largest number of projects carried out at the Latin American level, this segment grew by 28% for 2019, however for the current year we observe an increase of 4 percentage points. If we move to regional growth, the increase in the Andean region was almost 3 percentage points and in the Southern Cone, the increase was much more significant, reaching almost 10 points. Meanwhile, by 2021, Education was the second lar-

gest segment served by integrators in Latin America. However, the growth was almost two percentage points below the growth evidenced in 2019. It is worth noting, that this segment developed sustainability for the industry with the incorporation of digital education, which was established after the arrival of the pandemic and in which most governments saw the need to invest in new technologies and integrated systems. It is worth noting that the industrial segment presented an exponential growth in Latin America, most regions included projects in this sector, which may be due to teleworking. As for the residential segment, and despite being one of the least attended, it had a positive growth for 2021 which stood at 12.2% while in 2019 it was 10%. In the Hospital sector, the opposite happened, for 2019 the growth was 10 % and for this year it was below this figure.

MAIN SEGMENTS OF AV PROJECTS IN 2020-2021 MEXICO, CENTRAL AMERICA AND THE CARIBBEAN

ANDEAN REGION

11.1%

14.3%

5.6%

31.4%

8.6%

16.7% 33.3%

2.9%

20.0% 22.8%

33.3%

COMMERCIAL CORPORATE EDUCATION AND GOVERNMENT HOSPITAL AND PHARMA INDUSTRIAL RESIDENTIAL

BRAZIL

9.9%

COMMERCIAL CORPORATE EDUCATION AND GOVERNMENT INDUSTRIAL RESIDENTIAL

* Source: Survey conducted on an online platform among integrators of the TOP 100 Latin American Installers/Contractors until August 31, 2021.

SOUTHERN CONE

12.5%

18.18%

6.3%

12.5% 27.27%

37.5%

18.18% 12.5%

9.9%

18.18%

COMMERCIAL CORPORATE EDUCATION AND GOVERNMENT HOSPITAL AND PHARMA INDUSTRIAL RESIDENTIAL

18.8%

COMMERCIAL CORPORATE EDUCATION AND GOVERNMENT HOSPITAL AND PHARMA INDUSTRIAL RESIDENTIAL TOP IOO INTEGRATORS • REPORT 2021- 2022

TOP BRANDS IN LATIN AMERICA IN 2020 AUTOMATION CRESTRON QSC KRAMER AMX EXTRON OTHERS* LUTRON CONTROL 4

3.1% 7.8% 26.6%

9.4% 9.4%

*ELAN, CUE,BLUESTREAM, SYMETRIX, RTI

18.8%

10.9% 14.1%

MICROPHONES

SHURE SENNHEISER AKG AUDIO-TECHNICA BEYERDYNAMIC OTHERS* TAIDEN ELECTRO VOICE *POLY, BIAMP, VADDIO, RODE, DPA, ARTHUR HOLM

3.4% 3.4% 11.8%

31.0%

6.8% 8.5% 15.3%

20.3%

AUDIO & VIDEO CONTROLLERS

CRESTRON BIAMP POLY (POLIYCOM - PLANTRONICS KRAMER VADDIO EXTRON ATLONA DATAPATH CHRISTIE OTHERS* ATEN *8QSC,BOSE,AMX, BSS, HAIVISION, ANALOG WAY

2.0% 4.0% 4.0% 18.2% 4.0% 5.1% 6.1%

16.2%

9.1% 13.1%

13.1%

Source: Survey conducted on an online platform among TOP 100 AVI integrators through August 31, 2021.

TOP BRANDS IN LATIN AMERICA IN 2020 SPEAKERS & AMPLIFIERS 3,5% 3,5% 3,5% 4,7%

QSC SHURE YAMAHA 4,7% SENSEY NEXO 5,8% MEYER SOUND JBL 7,0% HARMAN DAS COMMUNITY 7,0% BOSE 8,1% BOSCH ELECTROVOICE ABSOLUTE TECHNOLOGIES CROWN

17,4%

15,1%

11,6% 8,1%

DISPLAYS & MONITORS

SAMSUNG LG NEC SHARP CHRISTIE BENQ PANASONIC VIEWSONIC BARCO HITACHI

1,6% 4,8% 4,8% 6,4%

27,0%

6,4% 7,9% 7,9%

23,8% 9,5%

PROJECTION SCREENS 2,2% 4,4% 4,4% DA-LITE DRAPER ELITE SCREENS SI PROJETELAS VUTEC GAIA VIEWSONIC BARCO

6,7%

37,8%

6,7%

Source: Survey conducted on an online platform among TOP 100 AVI integrators through August 31, 2021.

8,9% 13,3%

15,6%

TOPTOP 100IOO INTEGRADORES INTEGRATORS• •INFORME REPORT2021 2021-- 2022

TOP MARCAS EN LATINOAMÉRICA EN 2020 - 2021 LED DISPLAYS 2,3% 4,7% 4,7%

SAMSUNG LEDEC OTHERS CHRISTIE ABSEN PANASONIC PLANAR - LEYARD BARCO SONY DAKTRONICS

30,2%

7,0% 7,0% 7,0%

14,0%

9,3%

*ITC, DICOLOR, LIGHTLINK, KMT LED, ABSEN

14,0%

PROJECTORS

EPSON PANASONIC NEC BENQ SONY BARCO OPTOMA DIGITAL PROJECTION, CASIO, VIEWSONIC CHRISTIE HITACHI VIVITEK, SIM2

2,6% 4,0% 6,6% 7,9%

27,6%

7,9% 9,2%

7,9% 7,9%

9,2% 9,2%

SUPPORTS 1,9% 5,7% 7,6% CHIEF MIDDLE ATLANTIC PEERLES AV OTHERS* CRIMSON AV VOGEL´S PRIMIER MOUNTS *MECANO CASE, ELG, TELECOM, WOMER, STRONG,NORT BAYOU, GAIA, ELG, IACI

30,2% Source: Survey conducted on an online platform among TOP 100 AVI integrators through August 31, 2021.

13,2%

18,9%

22,6%

IMPORTS AV - CENTRAL AMERICA COUNTRY

DATES

Costa Rica

Jan - Aug 2021

Panama

Jan - Aug 2021

COMPANY

MAIN ORIGINS

VALUE IN USD

AXIOMA

Mexico - United States

2.222

CIF

CR CONECTIVIDAD

United States, Porcelain, Mexico, Germany, Taiwan

7.582

CIF

INTECH ENGINEERING

United States

2.558

FOB

ADVANCED TECHNO PRODUCTS

Unted States

7.776

FOB

IMPORTS AV - ANDEAN REGION COUNTRY

Colombia

Peru

DATES

Jan-Dec 2020

COMPANY

MAIN ORIGINS

VALUE IN USD

INTEGRACIÓN AV

Mexico, Taiwán, United States

61.075

FOB

AMBIENTES INTELIGENTES

Porcelain

5.134

FOB

DATECSA

Porcelain, Mexico, Taiwan

58.766

FOB

VIDEOCORP

Mexico, Taiwan

58.039

FOB

SCHALLERTECH

Mexico, United States, Porcelain

11.125

FOB

CONSTRUCCIONES ACÚSTICAS

United States

46.485

FOB

SEEL

United States, Porcelain, Mexico

14.850

FOB

AV DESIGN

Mexico, Porcelain, United States, France

80.978

FOB

DB SYSTEMS

United States, Porcelain, Mexico

34.427

FOB

VENTTO TECNOLOGÍA INTEGRAL

Mexico, United States

22.899

FOB

ONE TOUCH SOLUTIONS

Taiwan, Israel, Porcelain

6.484

FOB

LIMA SOUND

Porcelain, Taiwan, United States

7.940

FOB

PLANNIG EST

Taiwan, Porcelain, Israel, Estados Unidos, Mexico

21.972

FOB

TELVICOM

Canada, United States

44.515

FOB

DACER

Taiwan, Porcelain, United States

36.344

FOB

AV IMPORTS - SOUTH CONE COUNTRY

Argentina

Chile

DATES

Jan-Jun 2017*

Jan-Dec 2020

COMPANY

MAIN ORIGINS

VALUE IN USD

VIDITEC

Japan - China

1.418.315

FOB

WULLICH AUDIO VIDEO

France - China

67.470

FOB

ICAP

China - United States

27.808

FOB

PROYECCIONES DIGITALES

China - Malasia

26.300

FOB

VIDEOCORP

United States, Canada, France, Spain

889.452

CIF

NOVOTIC

United States

2.873

CIF

FOB (Free on Board) CIF (Cost, Insurance and Freight) *Most recent data available **Source: Descartes Datamyne with official information

TOP IOO INTEGRATORS • REPORT 2021- 2022

LIST OF IMPORTS FROM LATIN AMERICA AND THE CARIBBEAN FOR PRODUCTS EXPORTED BY COUNTRIES OF THE REGION Product: 8517 Electrical apparatus for line telephony or telegraphy, including cordless telephone sets with cordless handset combined with microphone and apparatus for carrier current telecommunication or digital telecommunication; videophones.

VALOR IMPORTED, THOUSANDS OF USD

140.000 120.000 100.000 80.000 60.000 40.000 20.000 0 2019 BRAZIL

ARGENTINA

YEARS GUATEMALA

2020 MEXICO

Source: International Trade Center Note: The graph explains the growth (difference) from 2019 to 2020 of imports into Latin America. The lines (colors) represent each country exporting AVI products to the region.

ORIGIN OF IMPORTS OF AV EQUIPMENT IN 2021

MEXICO & CENTRAL AMERICA CHINA ESTADOS UNIDOS OTROS* HONG KONG VIETNAM OTHERS*

2.0% 4.0% 5.0% 37.0% 24.0%

* GERMANY, JAPAN, SWITZERLAND, DESTINATIONS NOT AVAILABLE

29.0% 1.0%

ANDEAN REGION CHINA OTROS* ESTADOS UNIDOS VIETNAM

2.0% 27.0%

* HONG KONG, MEXICO, BRAZIL, DESTINATIONS NOT AVAILABLE

SOUTHERN CONE

16.0%

CHINA VIETNAM OTHERS* *MEXICO, UNITED STATES, BRAZIL, HONG KONG

70.0%

52.0% 32.0% 2.8% 4.2% 13.3%

BRAZIL

Note: In the group of *Other countries are located those with lower % of imports and NONPREDISPONSIBLE DESTINATIONS. The latter do not group country identification data through the Descartes Datamyne platform. *Source: Descartes Datamyne with official information.

CHINA VIETNAM OTHERS* ESTADOS UNIDOS MÉXICO

65.3% 14.4%

* THAILAND, FORMOSA, HONG KONG, MALAYSIA

TOP IOO INTEGRATORS • REPORT 2021- 2022

GROWTH AND IMPACT OF THE COMMERCIAL SEGMENT IN AV 18,0% 16,0% 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0%

2018-2019

2020-2021

Decrease/increase

The percentage of economic growth (annual) marks a constant trend in the commercial sector. It is then that for the year 2020-2021 there is no evidence of the decrease that would be expected with the arrival of COVID. This may be due to the need to install integrated systems for teleworking, in addition to acquiring new audiovisual technologies to carry out events and remote activities.

COMPARISON OF HOSPITAL AND EDUCATION SEGMENT GROWTH

2018-2019 2020-2021 Decrease/increase

Education

Hospital

The comparison shows that although for health and education digital technology systems, AV equipment, and integrated systems are necessary and have been incorporated with high demand in the region to meet distance education and perform telework and telehealth in order to provide access, are not yet the sectors with the greatest supply by integrators, since by 2020 the most important growth is evident in the industrial sector with 16.30%.

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 2

PERSPECTIVES OF THE LATIN AMERICAN INTEGRATORS COMPANIES The various representatives the companies integrators the Top 100 shared with us their perceptions of the projects and market trends they developed in the region, as well as their forecasts for the future, mainly considering the repercussions of the COVID-19 pandemic. In addition, they shared the results obtained (such as the value of sales per project completed) in 2020 and their expectations for growth and sales in 2021. Also, industry integrators were consulted about the perception of this business in recent years and the aspects that all players should strengthen to drive growth and economic recovery after the arrival of the pandemic. In addition, they focused not only on the technological issue but also on the growth of the industry in three scenarios: international trade, reduction of rents due to the pandemic, and in a third scenario: capital flows in relation to the risk that financial markets have within the industry.

Mexico

Aplitec Ingeniería SA de CV José Luis Olvera

• Where is your main office located? Do you have offices in other cities or countries? Headquarters: Cancun Quintana Roo. Branch: Mexico City. • What associations do you belong to and what certifications do you have? AVIXA, CEDIA. • How many projects did you carry out in 2020? 9 Important.

Grupo Act

César Centeno Commercial Director (partner) • Where is your main office located? Do you have offices in other cities or countries? Monterrey the corporate office, offices in Mexico City and Culiacan. • What associations do you belong to and what certifications do you have? PSNI / Avixa / Consorcio TEC. CTS CTS-D CTS-I (the only engineer in Mexico with all 3). Certifications in: Extron, Crestron, Biamp, QSC, Adinate, Kramer, Harman, Shure, Poly, Atlona, Cisco, Sennheiser etc. • How many projects did you carry out in 2020? More than 200. • Share with us an approximate dollar sales figure for projects completed last year. USD $8,000,000. • Please share with us the details of a highlight project during the past year. Implementation of 30 oral trial rooms for the federal government, in 7 different states of the country. • In which cities are you participating more? Monterrey and Mexico City, but we have attended projects in each of the 32 states of the Mexican Republic. • Tell us about your growth and sales prospects for 2021. reach USD $10,000,000 in sales and grow our solutions in Latin America.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Viewhaus Sistemas, S.A. de C.V. Juan Carlos Medina Director

• Where is your main office located? Do you have offices in other cities or countries? Guadalajara, Jalisco Branches in: S.L.P. and CDMX. • What associations do you belong to and what certifications do you have? AVIXA, PSNI. Certifications: CTS, PSNI Global Deployment, PSNI Global Services Certification, Extron AVA, Extron Control Specialist, Extron Control Professional, Extron XTP Systems Technician, Extron XTP Systems Design Engineer, Extron Authorized Programmer, HDBaseT Advanced HDBaseT Installer Training, Biamp Tesira Forté, QSC Q-Sys Level 1, QSC Q-Sys Level 2, Bose Modeler Sound System Software, Crestron CTI-CSD Crestron System Design, Crestron Digital Media Certified Designer 4K, Biamp Audia, Biamp Vocia, Audinate Dante Certification, Nexo, Shure Integrated Systems Certification and Shure Microflex Advance.

• How many projects did you do in 2020? Around 30. • Share with us an approximate dollar sales figure for projects completed last year. USD $3,000,000. • Share with us the details of a highlight project during the past year. AV integration of the new Jesuit University Library in Guadalajara. • In which cities are you most involved? Guadalajara, Querétaro, SLP, Culiacán, CDMX. • Tell us about your growth and sales prospects for 2021. Due to the pandemic, we believe we will have a maximum growth of 5%.

Inteliksa

Artcoustix

• Where is your main office located? Do you have offices in other cities or countries? Mexico City and Los Cabos.

• Where is your main office located? Do you have offices in other cities or countries? Mexico City.

• What associations do you belong to and what certifications do you have? CEDIA, AVIXA.

• What associations do you belong to and what certifications do you have? Avixa, PSNI, and we have certifications in brands such as Shure, Biamp, Crestron, Zoom, Bose, Kramer, AVIXA, Nexo, Barco, QSC, Christie, Cambridge, Protección Civil, among others.

Juan Enrique Granados Commercial Director

• How many projects did you carry out in 2020? 25 projects. • Please share with us an approximate figure of sales in dollars for the projects completed last year. USD $1.500.000. • Share with us the details of an outstanding project during the previous year. Cedros Cinema for 18 people. • In which cities do you have the most participation? Mexico City, Los Cabos, Acapulco, Cuernavaca, Veracruz and Toluca (mainly). • Tell us about your growth and sales prospects for 2021. 50% growth vs. 2020.

Héctor Vázquez Project Manager

• How many projects did you carry out in 2020? About 20 due to the situation. • Share with us the details of a highlight project during the previous year. A 10-story project in Mexico City, with state-of-the-art technology (video walls, automation, touch screens, separate room systems, auditorium, multipurpose rooms, meeting rooms, video conferencing systems, among others). • In which cities do you have the greatest participation? Mexico City, Guadalajara, Queretaro. • Tell us about your growth and sales prospects for 2021. We seek to reactivate the company’s economy with the return to work, having into account the necessary security measures.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Creatio

G4 Audio y Video

• Where is your main office located? Do you have offices in other cities or countries? Cdmx, Mty, Qro, Cancun.

• Where is your main office located? Do you have offices in other cities or countries? Mexico City.

• What associations do you belong to and what certifications do you have? Avixa, USA/AV, PSA. All industry certifications (Crestron, Biamp, Qsc, Samsung, AMX, etc).

• What associations do you belong to and what certifications do you have? AVIXA, Digital Signage Association, CEDIA. Certifications in multiple brands: Crestron, QSC, Sennheiser, Biamp, Shure, Kramer, Barco, Samsung, LG, AVIXA.

Juan Carlos Martínez General Manager

• How many projects did you do in 2020? About 50 projects. • Share with us an approximate dollar sales figure for projects completed last year. USD $3.500.000. • Share with us the details of an outstanding project during the previous year. Omnitracs Corporate, BBVA monitoring center. • In which cities do you have the greatest participation? Mexico City and Mty. • Tell us about your growth and sales prospects for 2021. We expect to grow by 50%.

José Luis Menéndez Mendiola Senior Design Engineer

• How many projects did you do in 2020? About 10 projects. • In which cities do you have more participation? CDMX and Monterrey. • Please share with us the details of a highlight project during the previous year. Implementation of 30 oral trial rooms for the federal government in 7 different states of the country. • In which cities do you have the greatest participation? Monterrey and Mexico City, but we have attended projects in each of the 32 states of the Mexican Republic.

Audity

SSL Digital

• Where is your main office located? Do you have offices in other cities or countries? Main office: Zapopan, Jalisco. Branch office: Aguascalientes, AGS.

• Where is your main office located? Do you have offices in other cities or countries? Jaime Balmes 11, Col. Polanco, Mexico City. Also offices in Guatemala (for Central America).

• What associations do you belong to and what certifications do you have? Certifications in several brands such as: QSC, BOSE, JBL, YAMAHA, CONTROL 4, FIBARO, UBIQUITI, HIKVISION, AVIXA. Basic courses: EXTRON, LUTRON, GRANDSTREAM, AXIS.

• What associations do you belong to and what certifications do you have? DS Latam, Empresa Socialmente Responsable, ISO 9000, UN Global Compact, Super Empresa Expansión, Super Espacio de Trabajo.

Ernesto Guerrero Managing Director

• How many projects did you carry out in 2020? 24 projects. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $772,953. • Please share with us the details of a highlight project during the previous year. Guadalajara Country Club Gymnasium. Audio, video, automation, networks, voice, data and access control were implemented. Project investment: USD $250.000. • In which cities do you have greater participation? Aguascalientes, AGS.

Guillermo Preciado Deputy Director

• How many projects did you carry out in 2020? 18 projects. • Share with us the details of a project that stood out during the previous year. We started a technological improvement project for some bank branches, which added around 5 new communication channels, including screens with exterior, interior and large format LED screens. • In which cities do you have the greatest participation? Mainly Mexico City, Monterrey and Guadalajara, most of the projects have a national presence. • Tell us about your growth and sales prospects for 2021. 25% increase.

• Tell us about your growth and sales prospects for 2021. 10% growth.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Central America

Vosmedia

Sergio Galindo General Manager Guatemala • Where is your main office located? Do you have offices in other cities or countries? Guatemala. Only 1 main office. • What associations do you belong to and what certifications do you have? AVIXA. • How many projects did you carry out in 2020? 288 projects. • Please share with us an approximate dollar sales figure for the projects completed last year. USD $1.350.000. • Share with us the details of an outstanding project during the previous year. Video Conference for 11 Courts executed at the height of the pandemic. • In which cities do you have the most participation? Guatemala City and Central Area. • Tell us about your growth and sales prospects for 2021. Growth of approximately 10%.

Comunicaciones Globales SA de CV Liduvina Carvajal Lizano General Coordinator El Salvador

• Where is your main office located? Do you have offices in other cities or countries? In San Salvador. • How many projects did you carry out in 2020? 700 projects. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $50,000. • In which cities do you have the greatest participation? San Salvador.

AdVanxSys

Anibal Vásquez Director - Project Design El Salvador • Where is your main office located? Do you have offices in other cities or countries? Approximately 50. • Please share with us the details of an outstanding project during the past year. *Audio, video, automation, lighting design and lighting fixtures, video surveillance, network, and fire detection system in the library museum of the Ministry of Foreign Affairs of El Salvador. • In which cities are you most involved? San Salvador. • Tell us about your growth and sales prospects for 2021. We expect a rebound of the projects that were paused during the past year, we have seen a high demand for remote collaboration solutions, such as videoconferencing, room adaptation, implementation of hybrid classrooms, and network upgrades in companies where remote work has required an update in the network infrastructure.

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Andean Region Integración AV SAS

Juan Carlos Gutiérrez Giraldo Manager Colombia • Where is your main office located? Do you have offices in other cities or countries? Bogotá, Colombia - We also have an office in Miami, USA. • What associations do you belong to and what certifications do you have? AVIXA BRONZE Member and we are CTS certified. • How many projects did you carry out in 2020? 55 projects. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $1,000,000. • Please share with us the details of an outstanding project during the past year. - Design, supply and implementation of a new headquarters for CESA University (Colegio de Estudios Superiores de Administración) where 11 classrooms, 2 meeting rooms and 1 collaborative space are automated. The classrooms are equipped with: Audio and video control, lighting control, air conditioning control by BacNet, 2 video projectors per classroom, 2 curtains per classroom, 1 touch screen, 1 control button panel, 1 wireless projection equipment, 1 camera with automatic tracking, 1 ceiling microphone, wireless video conferencing (Mersive Solstice) for virtual classes, automatic on/off, 1 scheduling screen with class information in each classroom, remote control and monitoring of each space (Crestron Fusion). Interactive monitors were installed in the other spaces.

• In which cities do you have greater participation? Bogota, Medellin. • Tell us about your growth and sales prospects for 2021. The same as in 2020.

Schaller Tech

Freddy Sampayo Information Systems Director Colombia • Where is your main office located? Do you have offices in other cities or countries? Barranquilla and Bogota. • What associations do you belong to and what certifications do you have? Avixa, Cedia. We have certifications from both associations as well as PMP certified engineers. • How many projects did you carry out in 2020? 38 projects. • Please share with us an approximate dollar figure for the projects completed last year. USD $2,000,000.

Ambientes Inteligentes

Juan F Montoya Executive Director Colombia • Where is your main office located? Do you have offices in other cities or countries? Medellin, Bogota. • What associations do you belong to and what certifications do you have? Avixa, CTS. • How many projects did you carry out in 2020? 30 projects.

• Share with us the details of an outstanding project during the previous year. INTERACTIVE URBAN MEMORY CENTER - The CIMU is a space full of interactive and audiovisual experiences that seeks to encourage the creation of memory, the promotion of dialogue, reflection and citizen construction, through knowledge and appreciation of the historical and cultural heritage of the city of Barranquilla and the department of Atlántico. • In which cities do you have greater participation? Bogota, Barranquilla, Santa Marta, Valledupar, Villavicencio, Cartagena. • Tell us about your growth and sales prospects for 2021. We expect to grow 30% over the previous year.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Magnopro Soluciones Tecnológicas S.A.S Sandra González Legal Representative Colombia

• Where is your main office located? Do you have offices in other cities or countries? Bogotá. • What associations do you belong to and what certifications do you have? Technology. • How many projects did you carry out in 2020? 7 projects. Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $160,000. • Please share with us the details of a highlight project during the previous year. Supply, installation and commissioning of the AUTOMATION, AUDIO, VIDEO AND CONTROL system for the SCARE company’s facilities, located in the CONCORD CENTER 122 building, consisting of several rooms of different sizes. Equipment from video projectors, speakers, cameras, microphones, monitors and automation equipment. • In which cities do you have the largest participation? Bogota. • Tell us your prospects for growth and sales for 2021 It is estimated to triple the sales figure, since everyone has been affected by the pandemic. It has been resumed little by little, since our commercial purpose is not of primary need.

AVD

Andrés Felipe Playa Operations Manager Colombia • Where is your main office located? Do you have offices in other cities or countries? Bogotá. • What associations do you belong to and what certifications do you have? AVIXA. • How many projects did you carry out in 2020? 20 projects. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $2,000,000. • Share with us the details of an outstanding project during the previous year. ROOM C3 Prosecutor’s Office. • In which cities do you have the greatest participation? Andean Region and Caribbean zone. • Tell us about your growth and sales prospects for 2021. 10% growth.

Telvicom S.A Víctor Villar Sales Manager Peru

• Where is your main office located? Do you have offices in other cities or countries? Lima. • What associations do you belong to and what certifications do you have? AVIXA. Certifications with Extron, Crestron, Bosch, Sony, Qomo and many more. • How many projects did you carry out in 2020? 2 projects. • Share with us an approximate dollar sales figure for projects completed last year. USD $8,000,000.

Multimedia Projects S.A.C Iván Carlos Canales General Manager Peru

• Where is your main office located? Do you have offices in other cities or countries? Lima, Peru. • What associations do you belong to and what certifications do you have? Lima Chamber of Commerce, we are certified with our main clients. • How many projects did you carry out in 2020? 23 projects. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $273,451. • Please share with us the details of a highlight project during the previous year. Complete development of a video wall system for a boardroom with professional sound equipment, controllers, mixers, microphones and other accessories. • In which cities have greater participation? Lima, North Zone: Trujillo, Chiclayo, Piura. South Zone: Arequipa, Moquegua, Tacna, Cuzco. • Tell us about your growth and sales prospects for 2021. We forecast to close the year with a total turnover of US$1,346,823.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Southern cone Seal Telecom

Eric Beraldo Marketing Specialist Brazil • Where is your main office located? Do you have offices in other cities or countries? São Paulo - Brazil is the main office and we have operations in other cities and countries.

• Share with us the details of an outstanding project during the previous year. Hybrid Rooms Project Universidad Adolfo Ibañez // OCT 2020 / Chile

Chile, Anfogasta, Concepción and Santiago. Mexico, Mexico City, Monterrey Argentina, Av Libertador, 6688 Puerto Rico, 1 Commerce Dr. Schaumburg IL 60173 Colombia, Carrera 9 No. 113 - 52 oficina 1405 - Centro Empresarial Santa Barbara - Edificio Torres Unidas - Bogota, Colombia Peru, 1350 Almirante Grau Ave. 1350 - Office 611 Barranco L0004 Paraguay, Washington casi Juan de Salazar nro 597 Costa Rica, Avenida de las Américas, 68th Street - Sabana Business Center, 9th floor Brazil, Av. Francisco Matarazzo, 1500 - 18°andar - Torre Los Angeles - São Paulo - Brazil, Praia do Flamengo, 66B, Room 507 - Rio de Janeiro/RJ Brazil, Centro Empresarial Barão de Mauá - Brasília/DF Brazil, Av. Moacir da Silveira Queiroz, 380 - Paranaíba/MS

University Adolfo Ibáñez, a prestigious institution of higher education, had an important challenge during 2020 in the midst of the pandemic.

• What associations do you belong to and what certifications do you have? Avixa - PSNI • How many projects did you carry out in 2020? More than 3,200 projects were carried out throughout Latin America. • Share with us an approximate figure of sales in dollars for the projects carried out last year. USD $100,000,000.

In a surprising and accelerated way, the need to bring the classroom to the homes of students and professors, due to the limited capacity, became a mission that we were part of. Together with Seal’s technology staff, teachers and engineers, we had to design a tailor-made suit, which turned out perfectly and has been a reference for other schools in the region. We achieved a result with high quality bidirectional sound, high resolution image quality, integration of soft codec and digitalization of blackboard content in a very professional and simple way for teachers and students. In addition, the same system and procedure was installed in all the campuses of the university, Peñalolén, Vitacura, Viña del Mar, Las Condes, which not only allowed the development of remote classes but also improved the exchange of content, enriching the experience with online audiovisual content, in a fluid way. • In which cities do you have greater participation? Brazil, Mexico, Chile, Colombia, Argentina and Peru. Tell us about your growth and sales prospects for 2021. We plan to grow more than 25% in the region and open other Latin American markets.

JPG Hardware House Ltda Joseanio Galdino Director Brazil

• Where is your main office located? Do you have offices in other cities or countries? São Paulo. We have no branch offices. • What associations do you belong to and what certifications do you have? Avixa, KNX. Certifications: AMX, CRESTRON, SHURE, QSC, LUTRON, KNX. • How many projects did you carry out in 2020? 9 projects. • Please share with us the details of a highlight project during the previous year. HARD ROCK CAFÉ - RIBEIRÃO All bar environments: Programming and commissioning. Lines: AMX, BSS, Shure, Magimage, Blackmagic, LG, Luton, .

Floor lighting system: 3,600m². Audio, video and conference system: auditorium, conference rooms, meeting rooms, staff areas. Lines: AMX, QSC, Shure, Polycom, Samsung, Epson, Lutron, Somfy. • In which cities do you have the largest participation? Rio de Janeiro. • Tell us about your growth and sales prospects for 2021 2020 - Turnover lower than in previous years, the projects carried out were pre pandemic fruit, few and small new projects. 2021 - We are experiencing an increase in demand for projects, but still with a low level of closure, however we are confident in the rebound of the professional audio and video market and a high demand for adaptations of existing facilities.

COPERSUCAR - SP 3 Combine meeting rooms that open to become a boardroom: project, deployment, programming and commissioning. Lines: QSC, Shure, LG, Somfy. LAME ADVOGADOS - RJ 3,600m² Unit: Project, Site Assistance/Installation, Programming, Commissioning

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Cenario Projetos AudioVisuais Marcelo Gotlib Executive Director Brazil

• Where is your main office located? Do you have offices in other cities or countries? Rio de Janeiro and Sao Paulo. • What associations do you belong to and what certifications do you have? Avixa. • How many projects did you carry out in 2020? About 120 services/sales performed. • Please share with us the details of a highlight project during the past year. Hybrid Rooms Project for FGV Brazil and Retrofit of all meeting rooms at Tozzini Freire Advogados. • In which cities are you most involved? Rio de Janeiro and São Paulo. • Tell us about your growth and sales prospects for 2021. This year we have already had 50% growth compared to last year and we should reach at least 70%.

NOVOTIC S.A

Videocorp

• Where is your main office located? Do you have offices in other cities or countries? Las Condes, Metropolitan Region, Chile. We do not have offices in other countries.

• Where is your main office located? Do you have offices in other cities or countries? Avenida las Condes 11700 tower A Chile (Concepción, Santiago, Antofagasta) Peru and Colombia.

• What associations do you belong to and what certifications do you have? AVIXA, INFOCOMM.

• What associations do you belong to and what certifications do you have? AVIXA, ALAS, PSNI, AVI, CRESTRON, GENETEC, BOSE, AXIS, SONY.

José Manuel Abarca Durán General Manager Chile

• How many projects did you carry out in 2020? 25 projects.

Matías Ramírez Mariscal Marketing Manager Chile

• How many projects did you carry out in 2020? Approximately 100.

• Please share with us an approximate dollar sales figure for the projects completed last year. USD $1,550,715. • Share with us the details of an outstanding project during the previous year. DERCO LA CABAÑA, MAZDA and SUZUKI Branch. Distributed Audio System, Distributed Video, Lighting Control, LED Screens, Digital Signage, Curtain Control, HVAC Control. • In which cities do you have greater participation? Santiago, Antofagasta, Osorno, Rancagua, Puerto Montt, Iquique. • Tell us about your growth and sales prospects for 2021. Novotic S.A. aims to have a 25% growth V/S the year 2020.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THE PERSPECTIVES OF AV INTEGRATORS

Soundtec SRL Alejandro P. Arena Sales Director Argentina

• How many projects did you carry out in 2020? During 2020 we have carried out 126 projects. • Approximate sales figure in dollars for projects carried out in 2020. USD $2,000,000. • Share with us the details of an outstanding project during the previous year. Within the residential sector we carried out a comprehensive AV project from the construction of the building to the end involving for a duplex of almost 800 square meters fully automated integrating a fully intelligent system governed by sensors of all kinds make the residence know all the time what day and time it is, what the weather is, what solar incidence, what external factors affect the residence, etc.. Inside there is a home theater room totally isolated acoustically and mechanically from the structure of the building and other environments, inside the walls can move in a motorized way to condition the acoustics and has all the components of a home theater of the highest quality, motorized seats, custom furniture, Korean coating, interactive walls, among others, then it has a master bedroom with all the facilities, three guest bedrooms, two desks, a large living room of almost 300 m2 that can be transformed from a minimalist living room to a discotheque by automatically emerging and hiding furniture, robotic lights, laser decoration, tri amplified audio systems, etc. Then there is a kitchen with a tactile countertop and a family room

that integrates into it with two AV systems that can be integrated into one. The entire apartment is controlled by a very powerful Crestron system that adapts each room to the needs of its two occupants. • In which cities do you have more participation? Buenos Aires - Autonomous City of Buenos Aires Córdoba - Catamarca. • Tell us about your growth and sales prospects for 2021. We expect to grow around 15% and incorporate new technologies for the segments we serve. • What associations do you belong to and what certifications do you have? Any recent ones? We are members of Avixa. Our company is ISO 9001 certified for all its processes and services.

Icap Global Martin Saul Argentina

• Where is your main office located? Do you have offices in other cities or countries? Buenos Aires, Argentina. Offices in Spain, Chile, Colombia and Peru. • What associations do you belong to and what certifications do you have? AVIXA. Several certifications, such as CTS and several manufacturer certifications. There is an extensive list. • How many projects did you carry out in 2020? 60 projects. • Share with us an approximate dollar sales figure for projects completed last year. 5,000,000 USD. • Share with us the details of an outstanding project during the previous year. Auditorium of Banco de Corrientes, for 500 people, LEDS main screen, audio equipment for cinema, high impact presentations, conferences and musical shows. Video system with multiple inputs, Video Conferencing System. General Control System. Etc. • In which cities do you have more participation? Buenos Aires.

ProMusica

Roberto Fuentes Director Uruguay • Where is your main office located? Do you have offices in other cities or countries? Montevideo. • What associations do you belong to and what certifications do you have? AVIXA, INFOCOMM, NAMM. • How many projects did you carry out in 2020? 6 projects. • Share with us the details of a highlight project during the previous year. New Shopping Center in Montevideo: Plaza Italia Shopping. New SODIMAC store in Montevideo. • In which cities do you have the greatest participation? Montevideo. Punta del Este. • Tell us about your growth and sales prospects for 2021. 300%.

• Tell us about your growth and sales perspectives for 2021. We estimate a sales growth of 20%, taking into account that 2020 was delayed.

TOP IOO INTEGRATORS • REPORT 2021- 2022

OUTLOOK EXPERTS / CONSULTANTS

“THINK OUTSIDE THE BOX, WHERE YOU WANT TO BE, AND WHAT YOU WANT TO DO”.

Ignacio Lucero

Vice President Seal Telecom- Latam

• LET’S START FROM THE MOST GENERAL: WHAT IS YOUR PERCEPTION OF THE AV INDUSTRY AT THE PRESENT TIME? The industry is adapting to changes. These changes have grown the demand for electronic components and semiconductors that are forcing customers to buy more than before.

• HOW DO YOU ANALYZE THE SECTOR OF INTEGRATOR COMPANIES? We have adapted, like everyone else, but it has been key at the management level to make the right decisions. Today it doesn’t matter how old your company is or how much you have sold, the customer cares about what you do for him today. Maintaining a relationship with customers and understanding their new needs is something that some have found more difficult. Connecting with the customer and listening to their new priorities is key. • HOW WOULD YOU DESCRIBE THE EVOLUTION OF THE INDUSTRY, LOOKING BACK OVER THE LAST 3 YEARS? The role of mobile devices in everyday life, the integration with everyday activities. A lot of things will stop being done in the physical and are done through apps then data traffic, 5G, the explosive construction of data centers and the importance of caring for the environment in a transversal way.

TOP IOO INTEGRATORS • REPORT 2021- 2022

• DO YOU CONSIDER THAT CUSTOMERS AND USERS OF AV ARE INCREASINGLY BETTER INFORMED AND MORE KNOWLEDGEABLE ABOUT NEW TECHNOLOGIES ON THE MARKET? HOW CAN THIS AFFECT CONTRACTORS AND INSTALLERS? Informed and demanding, it forces to improve service levels. • IN YOUR OPINION, WHICH LATIN AMERICAN COUNTRIES ARE HAVING A GOOD TIME IN THE AV INDUSTRY? IN WHICH IS STAGNATING? I think Chile, Colombia, Mexico and Brazil. Stagnant countries clearly Venezuela. Opportunities I think in Peru, where there are investment opportunities that I think will be carried out once the political and economic course is clarified. Argentina, although in a bad economic moment, is a huge market, with a good technological level and where there are good professionals, hopefully someday it will regain strength. • WHAT DO YOU THINK ENTREPRENEURS NEED IN ORDER TO CONTINUE PROMOTING THIS INDUSTRY? Let’s defend the value of technology with a longterm vision, understand that technology is not useful in itself, but a tool, in that sense maintaining contact with the community is key, as well as giving space to our collaborators for their professional and personal development. • WHAT RECOMMENDATIONS WOULD YOU GIVE TO ENTREPRENEURS WHO ARE GOING THROUGH DIFFICULT TIMES, AS IN ARGENTINA OR VENEZUELA? Think where you want to be, and what you want to do. I do not think it is fair to consider both countries in the same situation, Venezuela has a more complicated economic situation and the restrictions are greater. • AS A PROGNOSIS, WHAT IS THE PERCENTAGE

GROWTH OF THE INDUSTRY IN RELATION TO INTERNATIONAL TRADE, THE REDUCTION OF RENTS DUE TO THE PANDEMIC? In AV, I believe that fixed installation sales are changing to unified communications. • HOW IS THE LEVEL OF INVESTMENT IMPACTING THE LEVEL OF CAPITAL FLOWS IN RELATION TO THE RISK THAT FINANCIAL MARKETS HAVE WITHIN THE INDUSTRY? The case of each country is different, Chile has the lowest risk category, Venezuela and Argentina the worst. Depending on the main economic activity of the country, and its conjugation with the scenario or political conditions, the result is varied. While it is true that economic groups today may question their investments in view of the socio-political and economic scenarios that have been experienced in Latin America, the critical infrastructure in the energy extraction and information sectors are on a timeline that has a long history, and evolving in long-term projects that I do not believe are susceptible to cyclical situations, it is a train that does not stop, and it would be very difficult to stop. • WHAT WOULD BE A BETTER SCENARIO: AN OUTLOOK THAT WOULD REMOVE FEARS OF RECESSION AND FOCUS ATTENTION ON PRODUCTIVITY ISSUES FOR THE SECTOR? Of course, crises can always be opportunities for growth and innovation. Fears are not realities, only warnings, you can act. • IN THE COMMERCIAL SEGMENT, HOW HAS THE ANNUAL ECONOMIC DOWNTURN DURING THE PANDEMIC AFFECTED THE INDUSTRY? WHAT HAS BEEN THE IMPACT ON THE ACQUISITION OF INTEGRATION SYSTEMS? More than an impact, I think it’s a change in the offering, an acceleration of market evolution, a change in the value proposition. We have experienced exponential growth, and I think the

EXPERTOS CONSULTORES AV company has been well managed in that regard. • WHAT GLOBAL TRENDS ARE BEING KEY IN THE INDUSTRY IN RELATION TO CONNECTIVITY? The internet of things, without a doubt, and the integration not only of audiovisual, but security, Smart building, access, emergency, RRSS, instant analysis of millions of data per second, which reminds us of the dilemma of AI experts, at what point will machines be able to think better. We are in an era where we are able to manufacture electronic transistors in microprocessors 10 times smaller than a particle like Covid-19.

• AND IN GENERAL, WHAT MESSAGE OR ADVICE WOULD YOU LIKE TO GIVE TO AV/I INTEGRATORS FOR THIS 2020- 2021? First of all, my condolences to those who have suffered the loss of loved ones in this tough crisis we have had to live through. But we will never stop having difficulties, the problem is not what has already happened, it is how we move into the future and continue working with dedication to maintain and improve our industry looking at the opportunities and challenges that the community puts before us with the professionalism that characterizes us.

TOP IOO INTEGRATORS • REPORT 2021- 2022

ACADEMICS PERSPECTIVES

“TECHNOLOGIES ARE NOT NEUTRAL AND THEIR DESIGNS, MANY TIMES TRANSFORMED IN TECHNOLOGICAL PACKAGES, CAN GIVE US ONLY THE PLACE OF USERS”.

Lucrecia Cardoso

Lic. In Political Cs - UBA. Director of the Observatorio del Sector Audiovisual e Infocomunicacional • WHAT IS THE PERCEPTION OF THE AV INDUSTRY AT THE PRESENT TIME? “If we think the world from Latin America in the digital era and add to that thought a single condition, that the ideas to be promoted hierarchize the generation of quality work for the whole of society, immediately appears a set of debates that organized workers on the continent we want to promote, convinced that work is not only a

social articulator but also the means to generate decent conditions for development and progress, an area of realization that incorporates the paradigm of the future a humanist condition, that of social inclusion.” For Lucrecia Cardoso, there is more than a 60% chance that if Latin America appears it will be a place of chaos, poverty, drugs, violence or sports, and less than 5% chance that it will be linked to the best technology. • HOW IS THE INDUSTRY EVOLVING? They are migrating towards more dynamic, multiplatform, and segmented concepts, which in many territories leads to concern about the care of local labor and its conditions in relation to the available content and platforms, forcing them to rethink the rules of the game. Cardoso added in his compilation “Políticas y producción audiovisual en la era digital en Amé-

TOP IOO INTEGRATORS • REPORT 2021- 2022

rica Latina” that “these changes operate in the same way in the world of communication, changing its forms and logics due to the scale and new technologies. We are now facing a major change in the cultural patterns of consumption and access to information. These patterns, mediated by smartphones and applications that operate through the internet connection (Apps), create new ways of generating news, of accessing them and of business models”. • THE IMPLEMENTATION OF PUBLIC POLICIES CAN STRENGTHEN ACCESS GAPS IN THE ACQUISITION OF AV SYSTEMS AND IMPROVE SUPPLY AND DEMAND? HOW CAN THIS AFFECT OR BENEFIT? Public policies are configured as the tool that allows hierarchizing the general interest over the particular interest, especially in those areas where the private sector is very strong and pretends that their interests override the interests of the whole. In the compilation, it also expresses that “technologies are not neutral and their designs, many times transformed into technological packages, can give us only the place of users or, on the contrary, open many doors to share developments, encouraging the incorporation of work and appropriation of the value that technology generates or that as a platform allows its realization. The digital ecosystem, with its global players and the financial logic pushing the other logics, must understand that the workers of each country and the governments that represent the State are not an obstacle but the fundamental social actors for the achievement of objectives”. • WHAT COULD BE DONE IN OUR CONTINENT WITH A COUPLE OF BILLION DOLLARS TO CONCEIVE, DESIGN, AND DEVELOP TECHNOLOGY FOR THE ENTERTAINMENT INDUSTRIES? In response, Cardoso affirms that “there are plat-

forms that are conceived, designed and produced entirely outside Latin America and the decisions of what content to the program are also made outside the region. The visible technology is a computer program (software) that allows accessing the platforms, choosing the available content, and watching content without downloading it (streaming). The complexity of the software makes it possible to perform thousands of functions simultaneously that define the final quality of the service, the most important of which are those that are not visible to those who enjoy the platform, such as, for example, an automatic check of the quality of the internet received by the device.” “Farms”, “clouds” and bots are the keys to the services and the factors that determine the advantages by which users define their preferences; three barriers to entry created by the digital ecosystem to the audiovisual sector, which must incorporate the already “naturalized” ones. • HOW IS THE LEVEL OF INVESTMENT IMPACTING CAPITAL FLOWS IN RELATION TO THE RISK THAT FINANCIAL MARKETS HAVE WITHIN THE INDUSTRY? “The digital ecosystem was originally composed of two different value chains, the telecommunications world that we can represent in the “transport and connectivity value chain”, which originally allowed for an interconnected home network. In relation to this, the expert argued: “In the analogical era, the” transport and connectivity value chain “established its competitiveness in three central links:” infrastructure deployment, “devices, “and” marketing and sales. ”. The “infrastructure deployment” was the main one, aimed at the acquisition of spectrum, licenses and permits to operate in each coverage area, the construction of telecommunications networks that would

ACADEMICS PERSPECTIVES allow physically connecting each end-user of the services offered “. The “devices” represent the final canning of the technological package, the customer relationship support, which supports in the hardware the connectivity and operation software on which the applications will run, which, in turn, are the support of the services.

• WHAT GLOBAL TRENDS ARE BEING KEY IN THE INDUSTRY IN RELATION TO CONNECTIVITY? What used to be intuition is now big data and “artificial intelligence” on a global scale, gigantic investments in “farms” with the capacity to store information and in “processors” with the capacity to work on that information, identifying relationships between the data and establishing connections with analysis matrices that allow achieving objectives in this digital community.

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 3

RANKING BY REGION

TOP IOO INTEGRATORS • REPORT 2021- 2022

Mexico COMPANY

SEGMENT

CONTACT

WEB INFO

VIEWHAUS

Corporate, educational, government, specialty broadcast and television

Juan Carlos Medina

juancarlos@viewhaus.com.mx

+52 33 3123 9355

www.viewhaus.com

CREATIO

Videoconferencing, telemedicine, visualization centers, digital signage, streaming, and unified communications.

Juan Carlos Martinez Minutti

jc@creatio.lat

+52 55 8589 8600

www.creatio.lat

MULTIMEDIA

Corporate, educational, home theater, digital signage

Mariana Aguilar

maguilar@multimedia.com.mx

+52 81 2090 1828

www.multimedia.com.mx

APLITEC INGENIERÍA

Audio, automation, control, lighting, theatrical and video engineering

José Luis Olvera

jlolvera@aplitec.com.mx

+52 99 8892 7712

www.aplitec.com.mx

GRUPO NIZA

Corporate, educational, residential, digital signage

Mariana García

mariana.garcia@gruponiza.com

+52 1 5531244393

www.gruponiza.com

G4 AUDIO Y VIDEO

Videoconferencing, telepresence, auditoriums, home theaters

Margarita Reyes

m.reyes@g4audio.mx

+52 55 5564 5742

www.g4audio-video.com.mx

SSL

Video, videowall, digital signage

Guillermo Preciado

gpreciado@ssl.com.mx

+52 1 11452070

www.ssl.com.mx

GRUPO COVIX

Audio, video, automation, conference rooms, video walls

Francisco Hernández

francisco@grupocovix.com

+52 55 5568 6364

www.grupocovix.com

C3NTRO TELECOM

Videoconferencing, audio, video, unified communications, digital signage

Edgardo Contreras Maturino

edgardo.contreras@c3ntro.com

+52 55 5147-8040

www.c3ntro.mx

Juan Enrique Granados

egranados@inteliksa.com

+52 55 5026 6969

www.inteliksa.com

INTELIKSA

Audio, automation, lighting, residential and corporate

PERCENTAGE OF RECOGNITION 10,26%

9,94%

9,49%

8,54%

7,96%

7,32% 6,59% 5,72%

5,61%

4,04%

Mexico COMPANY

SEGMENT

CONTACT

WEB INFO

Roberto Rodríguez

roberto.rodriguez@encore-mx.com

+1-847-450-7203

www.encoreglobal.com

César Centeno

ccenteno@grupoact.com

+52 81 8333 9821

www.grupoact.com

Ignacio Lucero

ignacio@sealtelecom.cl

+52 55 5594 0390

www.sealtelecom.com.br

César Zenil

czenil@artcoustix.com

+52 55 5598 6016

www.artcoustix.com

Residential, corporate, commercial, audio, video, automation, lighting

Javier Guerra

jguerra@wiredhouse.com.mx

+52 8115886492

www.wiredhouse.com.mx

TEDD - GRUPO TELETEC

Audio, video and lighting for theaters, and museums

Enríque Lask

enrique@tedd.com.mx

+52 55 3000 1870

www.tedd.com.mx

Corporate, automation, videoconferencing, commercial audio, home theater

Manuel Carselle

mcarsell@cavc.com.mx

CENTRO DE AUDIO, VIDEO Y COMUNICACIONES / CINE EN CASA

+52 55 5373 4456

www.cavc.com.mx

AV PRESTIGE

Audio, video, multimedia, cinema, automation

Carmen Jiménez

carmen.jimenez@avprestige.com.mx

+52 22 2298 2119

www.avprestige.com.mx

AUDITY

Acoustics, home automation, audio and video, Networking/WiFi/IT, ecotechnologies

Ernesto Guerrero

eguerrero@audity.mx

+52 33 1591 0742

www.audity.mx

KOLO

Digital signage, content creation, training

Pedro Zaldívar

pzaldivar11@gmail.com

+52 55 1107 8686

www.kolo.digital

ENCORE INGENIERÍA

Audio, video, automation integration

GRUPO ACT

Videoconferencing, audioconferencing, CCTV, VoIP

SEAL TELECOM

Theater, meeting rooms, cinema, buildings

ARTCOUSTIX

Audio, video, control, and special engineering

WIREDHOUSE

PERCENTAGE OF RECOGNITION 3,23%

3,21%

2,90% 2,87% 2,60% 2,26%

2,14%

2,00%

1,78% 1,56% 100,00%

TOP IOO INTEGRATORS • REPORT 2021- 2022

Central America COMPANY

1 2

AUDIO CINEMA

HOME & OFFICE TECHNOLOGIES

COUNTRY

SEGMENT

Rolando Cordero

Costa Rica

Integration of audio and video for residential, commercial and corporate sectors.

506 22282503

www.audiocinema.net

Videoconferencing, audio, video, digital signage, residential

Renata Solano

renata@hot.cr

+50 62272 8095

www.hot.cr

Multimedia and building automation, intelligent classrooms

Sergio Galindo

sigalindo@vosmedia.com

+502 2387 0700

www.vosmedia.com

Alejandro Carbajal

alejandro.carbajal@comunicacionesglobales.com

+504 2263 4444

www.comunicacionesglobales.com

Fernando Hernández

ventas@musitempo.com

+1 809 548-6664

www.musitempo.com

María José Rodríguez

majorodriguez@audio-conceptos.com

+50 22460 7044

www.audioconceptos.com

Building automation, structured cabling, power quality

José Rolando Alvarado

rolando.alvarado@axioma.co.cr

+506 2290 9243

www.axioma.co.cr

Lighting and automation for residential, commercial and corporate sectors

Francisco Salazar

info@adara.com.gt

Costa Rica

VOSMEDIA

COMUNICACIONES GLOBALES

Honduras

Projection, education, video conferencing

MUSITEMPO

Dominican Republic

Audio, automation, commercial, residential

Guatemala

Residential and commercial audio, video, lighting

5 6 7

AUDIO CONCEPTOS

AXIOMA

ADARA

Guatemala

Costa Rica

Guatemala

CONTACT

INFO WEB

PERCENTAGE OF RECOGNITION

info@audiocinema.net 10,38%

9,36%

8,50%

8,47%

7,22%

7,16%

6,80%

6,50% +502 2429-7655

www.adara.com.gt

Central America COMPANY

ADVANCED TECHNO PRODUCTS

INTECH ENGINEERING

SIGNO

ABASTOS Y SERVICIOS

MASCO INGENIERÍA

COCATEL

ADVANX SYS

COUNTRY

SEGMENT

CONTACT

INFO WEB

Audio, video, lighting, home automation, education

Zeythel Soto

zsoto@ciabtesh.com

(507)264-4975

www.advancedtechno.net

Audio, video and control systems for corporate and commercial markets

Albeiro García

gerencia@intech-engineering.com

+507 390 8083

www.intech-engineering.com

Automation, visual systems, communication

Karen Rivera

krivera@signoca.com

+503 2209 0808

www.signo.com.sv

Dominican Republic

Audio, video, automation, CCTV, unified communications

Roberto Ruiz

r.ruiz@abasto-servicios.com

+809 732 6655

www.abasto-servicios.com

Gilberto Chaves

gilberto@masco.la

Costa Rica

Audio, video and automation for commercial

+506 2223 2201

www.masco.la

Audio, video, videoconferencing, digital signage

Odair Álvarez

oalvarez@cocatel.com

+504 255 0604

www.cocatel.com

Home, professional and commercial audio

Aníbal Vásquez

anibal@advanxsys.com

Panama

El Salvador

Honduras

El Salvador

PERCENTAGE OF RECOGNITION 6,16%

5,83%

5,61%

5,11%

4,69%

4,14%

4,08% +503 2124 8507

www.advanxsys.com 100,00%

TOP IOO INTEGRATORS • REPORT 2021- 2022

Andean Region COMPANY

COUNTRY

SEGMENT

CONTACT

INFO WEB

Audio, video, videoconferencing, corporate, residential, control rooms

Matias Ramírez

contacto@videocorp.com

Colombia / Peru

+51 1 447-6525

www.videocorp.com

Juan Carlos Gutiérrez

jgutierrez@integracionav.com

+57 1 373 9538

www.integracionav.com

Carolina Fernández

carofernandez@seel.com.co

+57 57 2235812

www.seel.com.co

Jorge Cabello

jorge.cabello@virtualika.com

+593 4 263 1190

www.virtualika.com

VIDEOCORP

INTEGRACIÓN AV

Colombia

Corporate, residential, control rooms

SEEL

Colombia

Audio, video, lighting, automation, education

VIRTUALIKA

Ecuador

juanfmontoya@a-int.co

Colombia

Audio, video, automation, corporate, commercial, residential

Juan Fernando Montoya

AMBIENTES INTELIGENTES

+57 4 444 4755

www.lacitaav.com

adt.duplat@gmail.com

Colombia

Acoustics, audio, video, theatrical mechanics, theater mechanics

Daniel Duplat

ADT ACÚSTICA

+57 1 214 0464

www.adtacustica.com

IMVINET

Venezuela

Video, digital signage

Juan Carlos García

garciajc@imvinet.com

+58 212 232 7259

www.imvinet.com

SEAL TELECOM

Manuel Salas Naranjo

manuel@sealtelecom.com.co

+57 320 238-3677

www.sealtelecom.com

Colombia / Ecuador

Video, control centers, automation

Darío Ordóñez Ibañez

csigerencia@centrosdecontrol.com

GRUPO CSI

+57 1 655 9288 +593 2 600 6336

www.centrosdecontrol.com

darestrepo@xegmenta.com

Colombia

Video, digital signage, corporate communications

Alejandro Restrepo

XEGMENTA

+57 4 444-2474

www.xegmenta.com gerencia@ultimate.com.co

Colombia

Audio, video, lighting, integration, for residential, education, corporate sectors

Lucas Valencia

ULTIMATE TECHNOLOGY

+57 6 324-2637

www.ultimate.com.co sales@alvanelectronics.com

Audio, automation, home theater, residential, commercial, boardrooms, meeting rooms

Luis Chirinos

ALVAN ELECTRONICS

+51 1 628 1600

www.alvanelectronics.com

TELVICOM

Audio, Video, Automation, Digital Signage

Carlos Anciburo

canciburo@telvicom.com

+51 962 382 437

www.telvicom.com

Peru / Bolivia

Peru

Theater, meeting rooms, cinema, buildings

9,39%

8,74%

7,78%

Audio and video automation for commercial and residential sectors

Colombia / Peru

PERCENTAGE OF RECOGNITION

5,42%

4,36%

4,24%

4,17% 3,97%

3,93%

3,77%

3,71%

3,65%

3,62%

Andean Region COMPANY

AVC INTEGRADORES

COUNTRY

Peru

SEGMENT

CONTACT

INFO WEB

Video, Automation, Home Theater, Control Rooms

Christian Yaipen

cyaipen@avintegradores.com.pe

+51 1 225 9195

www.avcintegradores.com.pe

Audio, video, collaboration, automation, digital signage

Alfredo Pereda Simoni

alfredo.pereda@dacer.com.pe

+51 1 9 4393 6431 1 943 936 431

www.dacer.com.pe

Diego Campos

ingieneria.dir@acustical.com

+57 311 474-7316

www.acustical.com

3,60%

DACER

CONSTRUCCIONES ACÚSTICAS

Colombia

Audio, acoustic design

DB SYSTEMS

Colombia

Audio, video, automation and control

Jhon Álvarez

jalvarez@dbsystems.com.co

+57 1 2137949

www.dbsystems.com

ONE TOUCH SOLUTIONS

Peru

Audio and video for corporate and educational sectors

Roymer Chávez

roymer.chavez@ots.com.pe

+51 1 440 1441

www.ots.com.pe

lsarmiento@limasound.com

Peru

Audio, automation, Home Theater, residential, commercial

Leoncio Sarmiento

LIMA SOUND

+51 1 241-1689

www.limasound.com

Audio, video, lighting, automation for residential, educational and corporate sectors

Ricardo Rodríguez

ricardo@schallertech.com

+57 5 301-4040

www.schallertech.com

Francisco Ortiz

fortiz@ingeacustica.com

+57 1 750 5799

www.ingeacustica.com

Iván Canales

icanales@proyectos-multimedia.com

+51 1 348 7484

www.proyectos-multimedia.com

SCHALLERTECH

Peru

Colombia

3,60%

3,22%

2,83%

2,50%

ING. ELECTROACÚSTICA

PROYECTOS MULTIMEDIA

Peru

Audiovisual

DIFUSIÓN

Peru

Corporate, hotels, education, government, digital signage

Guillermo Gutiérrez

guillermo.gutierrez@difusion.com.pe

+51 1 616 0800

www.difusion.com.pe

DATECSA

Colombia

Audio, Video, Automation, Digital Signage

María Victoria Montiel

mariamontiel@datecsa.com

+57 (7) 697 3777

www.datecsa.com

contacto@videocorp.com

Peru

Audio, video conferencing, digital signage

Matias Ramírez

PLANNING-EST

+51 1 447-6525

www.videocorp.com

Audio, Home Theater

3,56%

2,53%

Colombia

PERCENTAGE OF RECOGNITION

2,42%

2,32%

2,28%

2,22%

2,16% 100,00%

TOP IOO INTEGRATORS • REPORT 2021- 2022

Brazil COMPANY

SEGMENT

CONTACT

WEB INFO

Daniel Skit

daniel@sealtelecom.com.br

+55 11 3877 4017

www.sealtelecom.com.br

Hans-Jörg Ulmer

ulmer@abs-tech.com

+55 11 2691 5113

www.abs-tech.com

Audio, video and lighting for commercial, residential and corporate sectors.

Ebel Valois

ebelvalois@hotmail.com

+55 81 34473233

www.audiocom.com.br

SOUND VISION

Audio, video, multimedia, sound systems for stadiums, digital signage

Carla Moura

carla@soundvision.com.br

+55 11 5181 0730

www.soundvision.com.br

Audio, video, automation, video conferencing, telepresence, unified communications

Gilmar Marques

gilmar@digitalnetbr.com.br

DIGITALNET

+55 17 4141 1212

www.digitalnet.com.br

JPG

Corporate, residential, auditoriums

Joseanio Galdino

joseanio@jpghh.com.br

+55 11 3877 0088

www.jpghh.com.br

Audio, video, automation, control centers, home theater, sound reinforcement

Ricardo Ferraz

ricardo.ferraz@quadcomm.com.br

QUADDCOMM

+55 11 2626 0713

www.quadcomm.com.br

TELEM

Corporate, auditoriums, conference rooms

Roseli Hipólito

roseli.hipolito@telem.com.br

+55 11 2274 9422

www.telem.com.br

HIGH RESOLUTION

Audio, video, automation, videoconferencing

Jakson Santos

jackson@highresolution.com.br

+55 11 973747175

www.highresolution.com.br

BETTONI

Audio, telepresence, acoustics, digital signage, automation

Danillo Bettoni

danillo@bettoni.com.br

+55 11 4433 6400

www.bettoni.com.br

SEAL TELECOM

Audio and video for corporate sector, digital signage, unified communications.

ABSOLUT

Audio and video for corporate sectors, virtual reality, cloud, control centers.

AUDIOCOM

PERCENTAGE OF RECOGNITION 19,27%

13,96%

6,62%

5,71%

5,10%

5,08%

4,94%

4,64%

3,79%

3,29%

Brazil COMPANY

SEGMENT

CONTACT

WEB INFO

Gilson Tupinambá

gilson.tupinamba@mundovisual.net

+55 21 2516 0597

www.mundovisual.net

Claudio Jounis

claudio.younis@eletroequip.com.br

+55 11 40852106

www.eletroequip.com

Audio, video and lighting for the commercial sector

Marcelo Gotlib

marcelo.gotlib@cenario.com.br

+55 11 2626 9913

www.cenario.com.br

Audio, video, automation, digital signage, artificial intelligence, sound systems

Davison de Souza

davison@solutione.com.br

SOLUTIONE

+55 81 3877-6804

www.solutione.com.br

ATHIE

Audio and video for corporate sectors and auditoriums

Ivo Wohnrath

comercial@awnet.com.br

+55 (11) 5501-6901

www.athiewohnrath.com.br

EAV - ENGENHARIA AUDIOVISUAL

Audio, video, sound, digital signage, digital signage, 3D, virtual reality, collaboration, mapping

Flavio Loureiro

flavio.loureiro@eav.eng.br

+55 31 30241654

www.eav.eng.br

ARCATTO

Audio, video, sound, acoustics, automation, automation

Paulo Boselli

paulo@arcatto.com.br

+55 11 32052750

www.arcatto.com.br

BSSCOM

Automation, sound, digital signage, digital signage, unified communications

Cristian Miranda

cristian@bsscom.com.br

+55 11 3467 7272

www.bsscom.com.br

SOM AMBIENTE

Audio, video, automation, corporate

Luiz Reis Lana

somambiente@somambiente.com.br

+55 31 3337 5863

www.somambiente.com

Audio, video for corporate, residential, control centers, control centers

Leonardo Quadros

leonardo@performancenet.com.br

PERFORMANCE

+55 41 2103 1200

www.performancenet.com.br

MUNDO VISUAL

Audio and video for corporate and educational sectors

ELETRO EQUIP

Audio, video and collaboration systems

CENARIO PROJETOS AUDIOVISUAIS

PERCENTAGE OF RECOGNITION 3,21% 3,12% 2,92%

2,90%

2,83%

2,79%

2,58% 2,56% 2,42%

2,27% 100,00%

TOP IOO INTEGRATORS • REPORT 2021- 2022

Southern Cone COMPANY

COUNTRY

SEGMENT

CONTACT

Audio, video, videoconferencing, corporate

Diego Selle

dselle@videocorp.com

+56 (2) 24316100

www.videocorp.com

Audio, video, corporate, education, video conferencing, digital signage

Martín Saúl

msaul@icap.com.ar

+54 11 4865 3755

www.icapglobal.com

VIDEOCORP

ICAP GLOBAL

VISION DIRECT

Uruguay

Educational, corporate and commercial Jorge Biatturi audio and video +598 2408 2336

NEWTECH SOLUTIONS MULTIMEDIA

Argentina

Audio, video, corporate, education, videoconferencing, video conferencing

Argentina

Chile Argentina / Chile

INFO WEB

jorgeb@visiondirect.com.uy www.visiondirect.com.uy

Susana Alvarez Vitale

susana.alvarez@newtech.com.ar

+54 11 4898 5400

www.newtech.com.ar

Audio, video, Audio Conferencing, Room Automation, Collaboration, Unified Communications, Digital Signage

Bruno Bucchianeri

bruno.bucchianeri@gmail.com

+54 11 5031-1660

www.expex.com.ar

EXPEX

SOUNDTEC

Argentina

Sound, video, lighting, automation, control

Alejandro Arena

alejandroarena@soundtec.com.ar

+54 11 45860400

www.soundtec.com.ar

SEAL TELECOM

Chile / Argentina

Audio and video for corporate sector, digital signage, unified communications

Andrés Pautasso

andres@sealtelecom.com.ar

+54 911 6720-7984

www.sealtelecom.com

VSS PROYECTOS

Argentina

Audio, video, lighting

Christian Herrero

christianh@vssproyectos.com

54 11 5934 7095

www.vssproyectos.com.ar

SPEVI

Argentina

audio, video, acoustics for commercial and corporate sector

Ronald Furet

rfuret@spevi.cl

+56 2 2222 5281

www.spevi.cl

Audio, video, lighting, control, corporate and residential

Adolfo Rasmussen

arasmussen@dcontrol.cl

+56 (2) 2946 4367

www.dcontrol.cl

DIGITAL CONTROL

Chile

PERCENTAGE OF RECOGNITION 10,16% 9,87% 9,02%

7,69%

5,90%

5,77%

5,48%

5,41%

4,24%

4,23%

Southern Cone COMPANY

COUNTRY

SEGMENT

WULLICH AUDIO VIDEO

Argentina

Audio, video, acoustics, residential and corporate automation

Guillermo Rico

info@wullich.com.ar

+54 11 4815 6006

www.wullich.com.ar

MACOM

Paraguay

Audio, video, lighting, automation, home theater

Orlando Invernizzi

orlando.invernizzi@macom.com.py

+595 2 121-2036

www.macom.com.py

CONVERGENCIA DS

Argentina

Video, digital signage

Luis María González Lentijo

lgonzalez@convergenciads.com

+595 981 142016

www.convergenciads.com

ANALISIS DE SISTEMAS

Uruguay

Audio and video commercial, corporate, education

Ariel Fabius

afabius@anasist.com.uy

+598 2711 9034

www.anasist.com.uy

NOVOTIC

Argentina

Audio, video, lighting, control, commercial, corporate, educational and residential

Francisco Ramírez

framirez@novotic.cl

+56 2 2211-3310

www.novotic.cl

VIDITEC

Argentina

Audio, video, videoconferencing, corporate, education

Maria Martha De Nucc

mmdenucci@viditec.com.ar

+54 (11) 4122 1200

www.viditec.com.ar

PROMÚSICA

Uruguay

Audio, automation, home automation, lighting

Roberto Fuentes

roberto@promusica-uy.com

+598 2480 8000

www.promusica-uy.com

PROYECCIONES DIGITALES

Argentina

Audio, video, digital signage, corporate, video conferencing

Gabriela Molina

g.molina@proyecciones.net

+54 11 5353 1110

www.proyecciones.net

VIDEO AUDIO INGENIERÍA

Argentina

Audio, video, automation, corporate and residential

Omar Martinella

omartinella@vaiargentina.com.ar

+54 11 4915 5500

www.vaiargentina.com.ar

INTEGRACIÓN DIGITAL

Chile

Felipe Juárez

felipe.juarez@integraciondigital.cl

+56 2 2844 8317

www.pantallastransparentes.cl

Video, digital signage

CONTACT

INFO WEB

PERCENTAGE OF RECOGNITION 4,06%

3,92%

3,64%

3,52%

3,37%

3,19% 3,11% 2,55% 2,53% 2,33% 100,00%

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 4 62

RISING FREIGHT AND CARGO PRICES - WHAT’S THE REASON?

FREIGHT AND CARGO MOVED ON DIFFERENT ROUTES FROM LATIN AMERICA (PERCENTAGE)

10.0% 5.0%

8.0% 2.3% -0.2%

0.0% -5.0%

-20.0%

2.2%

1.5%

-2.5% -2.3% -6.0%

-11.8%

-6.0%

-9.9%

-9.80% -16.2%

Europe

Variation in exports

1.5% 1.0%

0.2%

-3.5%

-10.0% -15.0%

7.0%

Asia

-18.9% Middle East - India

North America

Variation in exported freight

Variation in imports

Intra Latin America

Variation imported freight

Comex

Source: Economic Commission for Latin America and the Caribbean (ECLAC) based on information from Drewry.

The increase in product prices, the scarcity of raw materials, and the high costs of container shipments are other concerns for industry integrators in terms of distribution and logistics. In addition, it is possible that the supply of some integrated systems, equipment, among others, may decrease. In relation to this, if there is an increase in demand in this scenario, the price increase would be much higher. Alessandro Nicita, economist at the UN trade agency (UNCTAD), explains that it is the strong recovery of exports in the world that is generating a real shock: “If trade were depressed, there would be no crisis”. According to Javier Diaz, president of Analdex, “this situation has generated a shortage of containers, defaults in itineraries and an accelerated increase in transportation costs. Thus, the average freight rates of 20-foot units from China to Latin America, for example, are now almost five times higher than the average of the last 12 years”. Before the pandemic, shipping a container from Asia

to Latin America and vice versa cost an average of $2,000 USD and sometimes as much as $1,500 USD, and today it is hardly possible to get sea freight on that route for less than $8,000 USD. The Asia-Europe corridor, on the other hand, reaches rates in excess of $10,000 USD and up to $14,000 USD for a single voyage. This is in addition to the increase in freight rates from Asia to the Americas. According to data available from the Freight Baltic Index (FBX), freight rates have been increasing over the last year. Such is the case from the East Coast of North America to China/ East Asia (10% increase) while from the East Coast of North America to Northern Europe there is a decrease of 18%. Thus, the price volatility for freight rates is 2.3%. The prices for these zones remain at $10,519 USD, which is equivalent to an increase of 2 %. From another point, it is shown that from Europe to the East Coast of South America the increase in freight rates is 4 % with a price of 3,688 USD.

TOP IOO INTEGRATORS • REPORT 2021- 2022

Increase (annual) in prices relative to the Global Index container loading

From To

03-Sep-2020

03-Sep-2021

$10.000 $7.500 $5.000 $2.500

01-Nov-20

01-Jan-21

01-Mar-21

01-May-21

01-Jul-21

01-Sep-21

Source: Freight Baltic Index (FBX).

Note: The price increases (annual: September 2020 to September 2021) shown in the graph are related to the Global Container Freight Index (USD values). From another point, as shown by the SFCI index, which is the most used indicator to measure ocean freight rates and analyzes the costs of routes with China for 20-foot containers, this has gone from just over 700 points at this time in 2019, to over 4,500 points at the close of August, i.e., a growth of almost 530 %. This figure is higher on some routes.

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 5 66

GROWTH OF DIGITAL EDUCATION INCREASED SUPPLY AND DEMAND FOR AV

The cessation of face-to-face activities created new ways of educating and working. It was then that the migration to digitalization became more latent and necessary. Information and communication technologies, audiovisual tools, and integration systems play a fundamental role at a social and economic level, since thanks to it, some jobs could be preserved and students could follow their academic calendar from home.

licies to combat the pandemic” estimated a drop in regional GDP of up to 5.5%. “It is expected that the crisis will impact the basic processes of building human capital, so policies to mitigate its effects and preserve educational trajectories in the long term are essential. In view of this, it is recognized that few countries had content platforms and audiovisual management and integration systems for learning and teleworking.

Additionally, it was the means to bring family members closer and became an entertainment tool to link meetings, celebrations, etc. Which in one way or another strengthened the act of humanization so difficult to strengthen as a result of the pandemic.

To which the bank added: “It is key to understand, however, that these resources were designed for education that would otherwise be delivered face to face or blended and not entirely remotely”.

This scenario and the use of audiovisual tools from home reflects the increase in the rate of trust between employer and employee and in turn means for the AV industry an economic balance (purchases and sales), since for some sectors that were served to a greater extent (before the pandemic) could present significant losses and generate an effect on the decline in demand for products integrators. This could then be offset by the growth of supply and demand in the education and government sectors, for example, which migrated to virtualization and thus created the need for increased investment to acquire tools and equipment. In relation to the above, the Macroeconomic Report of the Inter-American Development Bank (IDB) “Po-

Estimates from the United Nations Educational, Scientific and Cultural Organization (UNESCO) and the International Institute for Higher Education in Latin America and the Caribbean (IESALC) show that the temporary closure affected approximately 23.4 billion higher education students and 1.4 billion teachers in Latin America and the Caribbean, representing approximately 98% of the region’s higher education student and teacher population. It is worth noting that the suspension of face-to-face activities has been extremely rapid in the region: for example, it began on March 12 in Colombia and Peru and in a matter of six days reached almost the entire population of higher education students and teachers in the region. By March 17, 21.7 billion students and 1.3 billion teachers had already been affected by the temporary closures. TOP IOO INTEGRATORS • REPORT 2021- 2022

Students and teachers affected by the suspension of face-to-face classes in LAC - 2020 25.000

1.600 1.400

20.000

1.00

15.000

800 10.000

600 400

5.000 200 0

0 12

Day of the month March 2020 Students

Teachers

Note: Estimate the cumulative number of students and teachers affected by the suspension of face-to-face classes during March 2020 in Latin America and the Caribbean (in thousands). Source: UNESCO- IESALC.

Thousands of teachers

Thousands of students

1.200

AV conditioning factors and barriers to access to digital education The development, adoption of technological solutions and incorporation of AV products and systems are conditioned by structural factors. According to ECLAC, “a heterogeneous productive structure, a labor market with marked informality and precariousness, a vulnerable middle class, a weakened welfare state, a deficient digital infrastructure and socioeconomic restrictions on access and connectivity” are the main barriers to access. In turn, the abrupt interruption of face-to-face activities now depends on a digital environment to which many have had to become accustomed to in a matter of days, evidencing a disparate management of virtuality, in terms of the handling of the different technological tools necessary to guide distance learning processes mediated by technologies and integrations AV, as well as the diversity of access to connectivity for the online teachinglearning process to flow effectively. Thus, this variability has to be equated with the risk that the digital divide may widen the academic divide. From another point of view, the connectivity and availability of computers, the lack of audiovisual equipment and integrated systems at home condition access to remote education. For UNESCO

and IESALC “in the region, of the total number of children between 0 and 17 years of age attending a public educational center belonging to poor households with daily incomes of less than $3.1 USD (PPP, 2011), 22% have access to the Internet at home and only 19% have access to a computer. The aforementioned proportion increases to 26 % and 22 %, respectively, when considering children from poor households with incomes below $5 USD. This, of course, does not take into account broadband connectivity or computer capacity”. As stated by the Inter-American Development Bank (IDB) “in Latin America less than 30 % of the most vulnerable high school students have access to a computer at home for schoolwork. Data from the PISA 2018 study show that most students in the region are not prepared to take advantage of online learning opportunities at home. On average, 64 % of 15-year-olds in secondary school have access to a computer at home for school assignments. Uruguay and Chile with 82 % show a computer access at home closer to that reported for OECD countries (89 %). In Peru (7 %), Mexico (10 %) and in Dominican Republic (13 %) access to computers by the most vulnerable groups is very limited”.

Percentage of households with internet connection by region 2018 100 90 80 70 60 50 40 30 20 10 0

Africa Latin America and Asia and the Caribbean Pacific

Arab Countries

CIS

Europe

North America

Source: UNESCO- IESALC. Note: Percentage of households with internet connection by region (2018). Source: International Telecommunication Union database, 2020. TOP IOO INTEGRATORS • REPORT 2021- 2022

Universities In Latin America and the Caribbean, there is a large contingent of universities that have virtual education ,with great variability in quality and also in completion rates. Other educational institutions, located in more remote areas of the countries, do not have broad-spectrum Internet service and some do not even have basic connectivity services, which does not allow for efficient AV integrations.

Among the online distance learning modalities, the use of asynchronous virtual learning platforms stands out, used in 18 countries, while only 4 countries offer live classes (Bahamas, Costa Rica, Ecuador and Panama). In turn, among the offline forms of distance learning, 23 countries broadcast educational programs through traditional media such as radio or television.

The entities also mentioned that in terms of support for continuity, some measures were established for virtualization and implementation of AV tools, “the first and most important area of initiatives seeks to promote the implementation of emergency technological solutions for training continuity”.

Most countries have digital resources and platforms for remote connection, which have been reinforced at an unprecedented speed by the Ministries of Education with online resources and the implementation of open television or radio programming. However, few countries in the region have national digital education strategies with a model that takes advantage of ICTs.

Other sources of concern are the access of students to technologies, integrated audiovisual systems and platforms required (76%) and the actual capacity of the institution itself, in technological and pedagogical terms, to offer quality online education (75%).

However, compared to the measures adopted by governments, it should be noted that there are other conditioning factors such as digital infrastructure, the level of digitization of enterprises, digital skills and the level of investment in the acquisition of AV equipment.

Strategies for continuity of studies in distance modalities (in number of countries) Distance learning instruments

Online learning

Offline learning

Broadcasting of educational programs on television or radio

online distance learning platforms

Resources for teachers

Delivery of technological devices

Online live classes

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on the Information System on Educational Trends in Latin America (SITEAL). *Argentina, Bahamas, Barbados, Belize, Bolivia (Plurinational State of Bolivia), Brazil, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, El Salvador, Grenada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Saint Lucia, Suriname, Trinidad and Tobago, Uruguay and Venezuela.

OVERVIEW ON THE USE OF AV TOOLS IN THE EDUCATION

TOP IOO INTEGRATORS • REPORT 2021- 2022

Mexico, Central America and the Caribbean

Mexico According to the “Survey for the Measurement of the Covid-19 Impact on Education” (ECOVID-ED) prepared by the National Institute of Statistics and Geography (INEGI), “of the 54.3 million people aged 3 to 29 years, 62.0 % (33.6 million) were enrolled in the 20192020 school cycle. Of these, it is estimated that 2.2 % (738.4 thousand people) did not conclude the 20192020 school cycle and more than half (58.9 %) directly indicated that it was for a COVID-19 related reason.”

who did not participate in the education system in 2019-2020 school cycle.

For the 2020-2021 school cycle, the enrolled population is 32.9 million (60.6 % of the total from 3 to 29 years old). Of these, 30.4 million (92 %) are the population that was also enrolled in the last school cycle (2019-2020) and 2.5 million (8 %) are enrollees

In 28.6 % of the households with a population between 3 and 29 years of age enrolled, an additional expense was made to purchase smartphones; in 26.4 % to contract fixed internet service, and in 20.9 % to acquire furniture to adapt space for study.

Regarding the AV industry and the impact on distance education, the data evidences that by level of schooling, 55.7 % of the higher education population used the laptop as a tool to receive classes, while 70.2 % of elementary school students used a smart cell phone.

Hours dedicated to remote work 34.5 28.1

26.3

25.4

22.6

22.2

14.3 9.6

10.5 6.3

Less than 2 hours per day

2 hours per day

3 to 4 hours per day Public

Private

Source: Valora (firm specialized in the fields of education and culture). Note: The graph shows the number of hours dedicated to distance work by teachers.

5 to 6 hours per day

7 o more hours per day

Costa Rica At the beginning of April 2020, the educational authorities issued the document “Guidelines for the support of the distance education process”, in which they assume the importance of the incorporation of technological resources, integrated audiovisual systems, software, among others, as well as the generation of specific and contextualized actions for distance learning.

most vulnerable and rural populations.”

According to the Ministry of Public Education (MEP) “of a school population of about 1 million, it is estimated that only about 43% have had access to the educational platform, while the other 57% have had. Likewise, between 30 % and 40 % of students have not had access to electronic equipment and Internet connectivity, a situation much more common in the

They added: “Teachers also have considerable gaps in terms of digital skills: little use of computers for pedagogical management and professional development, lack of training in virtual tools, integration systems, lack of AV equipment. At the territorial level there is also evidence of significant gaps in access to good connectivity between the GAM and peripheral regions.”

A. Expenses of educational institutions

B. Average PISA score

On the other hand, several experts in the field of education such as Isabel Román Vega, Coordinator of the “State of Education Report” stated: “the improvised school at home faces very unequal realities because households experience the pandemic in very different ways”.

% of GDP, most recent year available

CRI COL

OCDE MEX

CHL URY

520 500 480

460

440

420

400

JPN ESP DEU MEX CHL COL OCDE PRT USA FRA ARG BRA SWE FIN NOR CRI

2009

2012

2015

380 2018

Source: OECD estimate; OECD Education at a Glance database; and OECD PISA database. Nota: Data for Costa Rica are based on the 2020 budget of the Ministry of Education and the National Learning Institute (INA). Including teachers’ pensions, spending in Costa Rica reaches 9% of GDP. Data for all other countries are from 2017 (latest available). TOP IOO INTEGRATORS • REPORT 2021- 2022

El salvador One of the main problems El Salvador has faced is having a quality education system but with a limited level of connectivity infrastructure, which limits access and investment in AV equipment and systems. More than half of the population remains disconnected and a high percentage does so through prepaid cell phone plans. Citizens have faced, for decades, limited and almost no access to real broadband services. Through an agreement with Google For Education and the government, 1.3 million licenses were obtained for students and teachers in the country’s public sector. As these were new tools for most teachers, they received training in the use and management of Google Classroom and more than 30 thousand

public sector teachers graduated. Additionally, according to the Government, “more than 70 thousand computers have been delivered and the goal is that 100% of students and teachers have their equipment, 1.2 million students and 36,000 teachers. Each of the computers has its accessories, software for the development of classes, updated drivers and 10th generation Intel processors”. They also have video editing tools, Microsoft Office accounts, technical support, Google Classroom and other platforms for the development of online classes. *Does not include graph due to lack of available data.

Guatemala The study Promoting Digital Development in Guatemala, by the Inter-American Development Bank (IDB) presented in 2019, shows that the use of high-speed Internet is very limited in the country’s schools.

technologies that can be implemented in different sectors of the country, depending on geography or existing infrastructure. This way you can be more efficient in spending.”

According to data collected by the Telephone Development Fund (FONDETEL), out of a total of 1,196 educational centers, only eight currently have an Internet connection. The 1,188 schools not connected are distributed among the basic (805), diversified (44) and primary (339) levels. These schools also have 1,040 computers that are not being used with online services.

According to data from the 2018 census, 83% of households in Guatemala lack internet, and according to educational indicators from MINEDUC, it is only available in just over one in two schools, a slightly higher proportion than the number of schools that have potable water. Despite the fact that six out of every 10 Guatemalans have a cell phone, not all cell phones have the option of connectivity, nor are they used for educational purposes, according to a report by Empresarios por la Educación. The digital divide in the country is undoubtedly deep, especially when it comes to accessing formal education.

On the other hand, Rodolfo Letona, Vice Minister of Communications, highlighted the importance of connectivity to realize these plans, which require two basic ingredients: fiber optics and vertical AV structures. “The important thing is that there are different

The portfolio with the largest budget

The largest increase in the budget of the Ministry of Education began to be observed in 2008. Cumulative growth (2008-2020) 207%

20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000

*Effective 2019 budget. **2020budgeted project

2020**

2019*

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

2,000

Source:Center for National Economic Research -CIEN.

TOP IOO INTEGRATORS • REPORT 2021- 2022

Panama The National Government announced the strengthening of the Solidarity Education Plan 2021, which will provide free access to virtual platforms for the benefit of students of official schools and teachers throughout the country.

Regarding connectivity in schools for the use of AV systems, the data points out that 60 % have connectivity (1,500 schools) (approx. 80 % of students). The centers without connectivity are generally those without electricity.

The proposal is directly related to user demand. According to the Government, a minimum fee was agreed with the four telephone companies, based on the data evidenced in the behavior of the 2020 school year, during which 378,000 students and 47,359 teachers created and used their email, 225,000 students used the Office 365/MS TEAMS platform and other technological systems for the school process of virtual classes.

In this regard, the IDB mentioned that “most of the students attending public schools do not have connectivity at home, nor technological resources”. It is worth noting that the Ministry of Education had been assigned a modified budget of US $1,684.8 for 2020, a figure that represented 6.99% of the total budget in percentage terms. For 2021 the budget allocated for education is US $1,821.9 which is 7.53 % .

Total modified budget 2021 by institution 3809 3,500

Total modified budget 2021

3,000 2,500 2,000

1822

1,500 1,000 500 0

Public debt service

Ministry of Education institution

Source: Ministry of Education of Panama. Note: Data corresponds to the modified budget allocated to ministries and debt in 2021.

Honduras In Honduras, only 16 out of every 100 people in urban areas have access to a computer, while in rural areas, where the largest population of children is located, only 1.9%. The data show that the difficulties are greater in rural areas, where only 29% of students have had links with their teachers through digital connections, a figure that grows to 45% in urban areas. According to the National Statistics Institute (INE), only 16.6% of the 9.3 million Hondurans have Internet access at home and only 12.8% access this service from a computer. According to the Digital Policy Law, only 40 out of every 100 citizens use the Internet in Honduras (fixed or mobile), which translates into around 3 mi-

llion 600 thousand users. 4G signals reach 92% of the country’s municipalities, which represents a growth in coverage of 2.4 percentage points compared to the fourth quarter of a year ago. In the private education sector, students, through creative ways of both teachers and parents, can be connected and receive their classes, however, in rural areas the reality indicates that only 7% have access to a computer or the Internet. According to figures from the United Nations Educational, Scientific and Cultural Organization (UNESCO), between 2014 and 2018, the Honduran State annually allocated an average of 24 % of its national budget to the education sector above that observed in Latin America (17.8 %).

Public expenditure on education as % of GDP 26

7.2 7.0

6.8

6.6 6.4

6.2 22

6.0 5.8

5.6

20 19

5.4 2014

2015 Education expenditure (public expenditure)

2016

2017

2018

5.2

Education expenditure (% GDP)

Source: Figures from the World Bank and the (UNESCO) Institute for Statistics. Note: Public spending on education as % of GDP and Central Government spending (2014-2018). Latest available data. TOP IOO INTEGRATORS • REPORT 2021- 2022

Dominican Republic The Ministry of Education identified 76,236 teachers without AV equipment or technological devices to teach. “The other challenge is that 2.8 million devices are required for students to be integrated into classes, including 200,000 at the initial level and another 300,000 in the adult program,” the entity stated. According to official estimates, around 500,000 students have connectivity with computers and tablets. On the other hand, the budget that will be allocated for the Ministry of Education for the year 2021, corresponds to 4 percent of the Gross Domestic Product (GDP), contemplates a reduction of RD$10,513,411,724, equivalent to 5.12 % less, with respect to the total budget approved for 2020. As for the level of investment that the government

Ministry of Education Budget

Amount Allocated

In 2020, 50 billion pesos were earmarked by the Dominican government to guarantee education for the country’s children in the midst of the pandemic. The investment contemplated internet access to Dominican families, the purchase of digital content, curriculum simplification, acquisition of technological equipment for students, as well as the adaptation and conditioning of schools for when the students return to school. Only for internet connectivity in Dominican homes, purchase of digital content and the acquisition of technological equipment and AV for students, at least 27 million pesos were invested.

Dominican government budgets approved by year

In millions of pesos

year

will make, it will be in technological devices (tablets and computers) and in infrastructure for telecommunications (access to telephony and internet throughout the territory).

In millions of RD$

Variation

2012

Increment (%)

430,000.7

39,525.1 10.1

58,590.4

0.0

2013

99,628.0

4,1037.6

70.04

2014

109,170.2

9,542.2

9.6

2015

630,933.9

17,797.1 2.9

2015

119,363.2

1,0193

9.3

2016

663,558

32,624.1 5.1

2016

134,277.0

14,913.8

12.5

2017

150,655.0

16,378

12.2

2018*

2018

152,765.3

2,110.3

1.4

2019

170,570.2

17,804.9

11.6

Total period

995,019.3

111,979.8

*11.25

2012

Source: Digepres.

530,846.2 613,136.8

711,399.2

100,845.5 23.4 82,290.6 15.5

47,841.2 7.2

814,821.0 103,421.8 14.5

2019

921,810.5 106,989.5 13.1 0

200,000 400,000 600,000 800,000 1,000,000

*Project for Budget

Andean Region

Bolivia According to a report by ATT, the governmental telecommunications agency, the Internet reaches only 40% of the population and only 3% in the case of rural areas, where classes have stopped completely since March 2020. On the other hand, according to the national opinion survey on information and communication technologies (ICT) elaborated by the Agency of Electronic Government and Information and Communication Technologies (AGETIC), only 42% of the population has a com-

puter and 10% has fixed internet; on the other hand, the numbers are much lower in rural populations, where only 18% have a computer and 3% have fixed internet. From another angle, it is clear that accessibility to virtual education does not consider factors such as the quantity and quality of the devices in relation to the number of household members and the cost of electricity and internet. Most households do not have the necessary internet access, nor the availability of the necessary devices and AV systems.

Enrolled population of children and adolescents with Internet access at home (fixed network or mobile network) by educational unit and household wealth quartile (%)

70% 60% 50% 40% 30% 20% 10% 0%

Very low

Low Private/Private

Medium

Medium high

Fiscal/Public/Agreement

Source: Household Survey (INE). Note: For the particular case - very low stratum, the indicator of internet access in the home (by fixed or mobile network) should be considered only as descriptive. Coefficient of variation outside the acceptable range (20%). TOP IOO INTEGRATORS • REPORT 2021- 2022

Colombia According to an ECLAC report, in Colombia, only 67% of 15-year-old students have an Internet connection, 62% have access to a computer and 29% have access to educational software. Furthermore, according to an analysis of the Laboratory of Economics of Education (LEE) of the Javeriana University, 17% of rural Colombian students have a computer and internet, so it is necessary to pay attention to the digital transformation in this sector. In addition to this, there are notable differences: 97% of families in strata 5 and 6 had an Internet connection, while only 17% of families belonging to stratum 1 had this service. It should be noted that the study of Digital Appropriation of the National Consulting Center reveals that today more than half of Colombians take advan-

tage of the Internet to educate themselves, participate and make transactions. This figure at the end of February, before the pandemic, was 33% and today, nine months later, it rises to 55%. On the other hand, there has been significant progress in the adoption of a number of technologies, such as the Internet of Things, artificial intelligence, blockchain, virtual augmented reality and 5G, boosting business and opening new avenues for the creation of value and development of ecosystems such as Healthtech, Agrotech, Fintech, Govtech, among others. Colombia today has 7.65 million fixed internet accesses, which means that connectivity has been achieved in 53% of households, more than one million new ones.

The higher education budget increases by

more than

Education budget

41,4 trillion

37,2

Operating

4,2

Investment

The highest education budget in the country’s history

Source: Ministry of Education.

4.5 Trillions 1,34

trillion 2019 2020

Earmarked for the core

CPI + 3,5% CPI + 4%

1,5 trillion 1,35 trillion 300 mil trillion

2021 2022

CPI + 3,5% CPI + 4,65%

from royalty collections for 2019 and 2020.

investment from the General Budget of the Nation.

surplus from the corporate sector

Ecuador 70% of students have difficulty accessing online learning. The lack of smartphones or the Internet, the drop in income and the lack of training prevent the normal education of millions of children during the pandemic. On the other hand, households with the internet correspond to 37.2 % nationally (46.6 % urban, 16.1 % rural). While households with computers: 24.5 % desktop, 24.2 % laptop, 11.2 % desktop and laptop. As for people using the Internet, 20.7% nationally (20.5% urban, 20.1% rural). The percentage of activated cell

phones is 59.0 % nationally (65.2 % urban, 46.0 % rural) and the number of smartphones corresponds to 41.4 % nationally (50.0 % urban, 23.3 % rural). It is then worth noting that until 2020 there were 4.374.799 students between basic education and high school. Of these, 2 million have connectivity; 1 million do not have a computer or internet at home or on their cell phones. According to data from the Ministry of Education “of the 12,863 fiscal and fiscomisionales educational units that exist in the country, 4,747 have internet access”.

Digital advertising investment Ecuador (desktop)

Investment does not include investment in mobile platforms and applications.

17%

6% 7%

15%

7% 10%

14% 12%

Telecommunications Automotive Banks and credit cards Tourism Education Government Construction Finance Transportation Media

22,19

2,88

Jan - Dec 2019 (9.194 advertisers)

Cost per thousand average desktop impressions in Ecuador

millions USD

50%

USD

additional estimate investment in mobile and applications

Source: Adcualiyi Note: Approximate estimate of additional investment based on mobile participation in Ecuador. TOP IOO INTEGRATORS • REPORT 2021- 2022

Peru The National Institute of Statistics and Informatics (INEI) indicated that up to the first quarter of 2020, 40.1 % of Peruvian households had Internet access, while the figure in rural areas dropped to 5.9 %. In Lima, 62.9 % of households have this service. The entity emphasizes that 79 % of public schools do not have Internet access. Likewise, there is a lack of equipment, since in Peru, there are 8 students per computer in primary school and 6 in secondary school.

In turn, the last National Survey of Teachers of Public and Private Educational Institutions (ENDO) conducted in person in 2018, indicates that about 69,000 teachers nationwide lack access to a computer or laptop and 136,000 do not have Internet service at home, with the difference being even greater in rural areas. For this year, the education budget has been increased by 4% compared to 2020, reaching S/. 32,715 million. The strengthening of distance education is prioritized.

Means by which households access the program

The majority of students access distance education via television

78% TV*

20% Radio

Source: Ministry of Education of Peru, Inter-American Development Bank - IDB.

22% website

Southern Cone

Argentina In the National Evaluation of the Pedagogical Continuity Process, carried out in June 2020, 55% of households reported having access to a working computer, 20% for the exclusive use of each student and 35% for shared use with other members of the family group. In the same evaluation, it was found that, in general, teachers had greater access to computers. Ninety percent of primary school teachers and 95 percent of secondary school teachers had one. However, at both levels, more than half of them shared it with other members of the household. In fact, the cell phone was the privileged means for educational continuity in the first year of the pandemic. Ninety percent of households used it to send or receive school assignments. However, the ownership of a cell phone varies significantly by age. According to a survey by the Observatorio de la Deuda Social en

Argentina of the UCA, while only 22% of children between 5 and 12 years old have their own cell phone, 78% of children between 13 and 17 years old have one. In 2020, according to the Ministry of Education, the number of computers will reach 55,000, equivalent to about 5% of the country’s teachers. In August 2020, the Juana Manso Federal Plan was presented, which includes four components (closely aligned with the first three intervention focuses analyzed in this document): equipment, connectivity, educational platform and teacher training. In this framework, the national Ministry of Education proposed for 2021 to acquire 633,000 computers with connectivity aimed at secondary school students, which would benefit 5.5% of students at compulsory levels in the country.

Percentage of boys and girls ages 4 to 17 who count with a computer at home, Argentina (2010-2019) 70% 64,7 65% 57,6

60%

63,4

60,9

58,6 56,1

54,3 55%

51,3

50% 45%

40,3

40%

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

35%

Source: Inter-American Development Bank- IDB. Agenda for Equity (2017-2025). Observatory of the Argentine Social Debt. TOP IOO INTEGRATORS • REPORT 2021- 2022

Brazil According to the Organisation for Economic Cooperation and Development (OECD), Brazil has made significant progress in improving Internet access, digital security and regulation, but much remains to be done to bridge the country’s digital divide and embrace digital technologies. “Digital technologies are the backbone of today’s economies, and digital tools and connectivity are essential to help businesses and individuals overcome the COVID-19 crisis,” said OECD Secretary-General Angel Gurría. The Country Digital Transformation Review, Going Digital in Brazil ,finds that despite recent progress, Brazil is lagging in investment in digital innovation

and in the level of digital skills in the workforce. On the other hand, among the advances made in recent years, subscriptions to communications services have steadily increased, thanks to mobile subscriptions tripling from 2012 to 2019, and relatively affordable mobile voice and data plans. The proportion of households with Internet access increased to 67% in 2018 from 40% in 2013, and the proportion of adults using the Internet to 72% from 50%. New laws have strengthened digital security and the protection of personal and consumer data. *Does not include graph due to lack of available data.

Chile 40% of students in Chile are in establishments that have provided training remotely in a massive way, understanding in this category to those establishments that declare that at least 80% of its students are using distance learning tools such as online classes, video conferences, social.

quintile) with the least vulnerable (richest quintile), because in the first group of establishments, the coverage by the students is 27%, while in the fifth group this coverage reaches 89% ”. On the other hand, the estimates obtained through of the SIMCE student questionnaire allow observe that 87% of students have access to devices of this type, but, again, there is a significant gap between the lowest quintile and the higher (77% and 97.

However, the World Bank emphasizes that “also It is important to note that this reality is very different when comparing the percentage achieved by the most vulnerable establishments (poorest

Distance education provision coverage in COVID-19 pandemic context

Poorest quintile

Average

Richest quintile

91%

89%

90% 92%

85%

83%

90%

100%

100%100%

100% 100% 100%

91%

90%

85% 79%

77%

80%

100% 100%

70% 60% 50% 43%

40%

46% 41%

30% 20%

27% 26% 28%

29%

26% 26%

10%

26% 28%

31%

26% 26% 25% 27%

14%

-5%

s A ys M w ag n al la ne s

le Ñ

na O

´H

ita

ro p

Va l

ac nt

ap A

ric

Ta r

do ga

ad o

o ic

Pú

Source: Ministry of Education based on the World Bank simulation tool TOP IOO INTEGRATORS • REPORT 2021- 2022

Uruguay The process of digital transformation of education got an early boost with the CEIBAL Plan, which universally provided devices, content platforms and learning management and integration systems, in addition to training teachers in their use and promoting new pedagogical practices.

students in quintile 1 and 5 is 22 percentage points. Likewise, internet access at home is unequal (99 % for households in quintile 5 compared to 70 % for those in quintile 1), according to preliminary data from the 2019 Survey of Uses of Information and Communication Technologies, as well as the possibility for families to accompany their children (23 % of middle-class families have heads of household with a minimum of 13 years of education compared to 1.5 % of the poorest).

The number of teachers and students who accessed the learning management system increased fourfold compared to before the pandemic: more than 75% of students and more than 84% of teachers connected to the platform.

Regarding connectivity in schools for the use of management and pedagogy systems, 100 % of schools have access for both uses.

However, the gap in access to this system between

Inflation for 2020 and 2021 $180.000

$128.846 $72.469

$143.005

$148.896

$156.818

$125.372

$114.076

$71.297

$20.000

$91.317

$40.000

$104.525

$77.325

$60.000

$94.056

$80.000

$119.783

$100.000

$94.517

$120.000

$118.257

$152.720

$140.000

$137.163

$160.000

* 21

it 20

ft L

re d

tc D ra

rr en

18 20

17 20

16 20

15 20

14 20

13 20

12 20

11 20

10 20

09 20

08 20

07 20

06 20

Source: CIPPEC, based on information from the National Ministry of Finance, CGECSE/ MEN, Consumer Price Index series IPC- INDEC and ECOLATINA. Note: The inflation considered for 2020 and 2021 arises from the consideration of the macroeconomic projections of the Message of the Budget Bill 2021.

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 6 88

SECTORS AND COMPANIES FACED WITH COVID-19: IMPACT ON THE AV INDUSTRY

After the pandemic COVID- 19 caused strong shocks in health and the economy and originated a much deeper social crisis, some countries are beginning to reduce the measures of confinement after having lived months of confinement, social distancing, among other measures taken to mitigate the spread of the virus. Faced with the above scenario, companies engaged in the integration of audiovisual production equipment have felt the slowdown in the AV industry by the paralyzation in production.

UNTIL 2019, LATIN AMERICAN COUNTRIES MAINTAINED CONSTANT FLUCTUATIONS AND GROWTH EXPECTATIONS

However, the increase in consumption of audiovisual content, the acquisition of integrated systems, audiovisual automation, the search for new formats, the relevance of promoting co-productions or the current situation of festivals and international markets, and the positive impact on the educational and the residential sector has generated opportunities for AV integrators.

FOR THE REGION WERE IN

The activities that remained in operation, those that returned and those that are planning to return face challenges related to technological innovations, digital change and its effects on the world of work. According to the study “Impact of the covid-19 pandemic on the audiovisual and live entertainment sector in the Americas”, organizational reconfiguration processes regained prominence with the pandemic, substantially increasing remote work and pre-existing labor relocation logics.

AUDIOVISUAL INDUSTRY HAD

1.7% FOR THAT YEAR AND 2.5 FOR 2020 ACCORDING TO WORLD BANK PROJECTIONS, THE BY THEN, A GREATER CHANCE OF GROWTH.

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Reactivation of the sector in figures In turn, it should be noted that there is already a significant revival in the health sector, airports and the education sector. In relation to the audiovisual production equipment sector, specifically in the audio market, until mid-2020 in the countries of the region more than 3 million people sought to buy some type of audio equipment. As reported by the interactive information system developed by CentralAmericaData in the Costa Rican market, of all consumers looking online to buy audio equipment, 6% tried to buy a speaker system. In Panama, of the total number of people looking to buy audio equipment online, 3% were trying to buy professional DJ systems. In Guatemala, that proportion rises to about 2%, and in Nicaragua to 4%. In the Salvadoran market, more than 11 thousand people tried to buy a speaker system, while in Honduras the figure was close to 22 thousand consumers. Also, in relation to the economic crisis, the law of supply and demand also presented interruptions due to the increase in the prices of raw materials and electronic components. The market, due to expectations of lower demand in some sectors, reduced its production in order not to incur losses. However, the scenario is much more encouraging, as demand has stabilized and even increased to pre-pandemic levels. In comparison, commodity production is still unable to keep pace with demand.

ble displays will increase to 3.9 million units in 2020, up from 700 billion in 2019. In addition, it was evidenced that shipments will continue to increase at an accelerated pace over the next five years, reaching 73.1 million in 2025. From another point of view, it is worth noting that during 2020 and 2021, e-commerce and distribution chains impacted digital signage (video and multimedia communication for public spaces) which had a statistically significant effect by not having audiences. This in turn generated the reduction of promotions, advertisements, notifications, among other important advertising topics for the industry. However, in terms of digital signage, special content was created to mitigate the spread of the virus, informing customers of the capacity of the place in real time, among other situations and measures that generate interest in the target audience. In relation to this, Meticulous Research estimated that the digital signage market will grow at a CAGR of 4.3% from 2020 to 2027 to reach $19,440 in 2027. The recovery scenarios are highly dependent on the ability of governments to effectively tackle the virus and vaccinate the population.

THE DIGITAL SIGNAGE MARKET WILL GROW AT A RATE OF 4.3% FROM 2020

According to Omdia’s Foldable Display Technology & Market - 2020 report, the growth of foldable displays in that year was estimated at 455 % internationally. This is taking into account the arrival of the initial wave of foldable smartphones in 2019. In turn, it was stated that global shipments of Amoled folda-

TO 2027 TO REACH $19,440 BILLIONS IN 2027.

Productive structure: the region’s external and internal gap and its effects after the pandemic The economic crisis generated by COVID-19 has had a major impact on the countries of Latin America and the Caribbean and has hit the productive and business structure, further highlighting the region’s weaknesses. The region’s productive structure is highly heterogeneous among sectors and companies. According to the Economic Commission for Latin America and the Caribbean (ECLAC), “few natural resource production and processing activities, some capital-intensive services (electricity, telecommunications and banking) and a few large companies have high levels of value added per worker, while the others have very low levels of productivity. It is important to note that the production structure is the basis for the region’s external and internal productivity gaps. The first measures the difference between labor productivity in Latin America and that of the United States, which is adopted as a reference for the international technological frontier. The second registers the difference that exists within each country between the labor productivity of micro, small and medium-sized enterprises (MSMEs) and that of large companies. In 1980, the external labor productivity gap in Latin America was 36.6% of that of the United States. After a sharp fall in that decade and, to a lesser extent, in the 1990s, relative productivity in the region reached barely one-fifth that of the United States between 1999 and 2018. In absolute terms, the region’s labor productivity grew by 0.6% per year between 2008 and 2018. As for the internal gap, heterogeneity among firms is very high in Latin America. In 2016, the labor productivity of a medium-sized firm was, on average, less than half of that corresponding to a large company. In small enterprises, labor productivity reached

only 23% of the productivity of large businesses, and micro firms had labor productivity equivalent to only 6% of that of large companies. Moreover, before COVID-19 arrived in Latin America, performance differences between the different segments of MSMEs were already more marked and productive structures were less heterogeneous, as in the European Union. For example, in the European Union, the productivity of medium-sized enterprises was less than double that of microenterprises (as a proportion of the productivity of large enterprises, 76% and 42%, respectively), while in Latin America it was more than seven times higher (46% compared to 6%).

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Comparison between Latin America and the European Union: domesticLATIN relative productivity COMPARISON BETWEEN AMERICA AND THE2016 EUROPEAN UNION: RELATIVE DOMESTIC PRODUCTIVITY 2016

80 70 60 Latin America

European Union

40 30 20 10 0

Microcompanies

Small companies

Medium-size companies

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official information. (Latest available productivity data through 2016). Note: Relative domestic productivity is measured by the quotient between the value of labor productivity of each AMERICA (5 COUNTRIES): SHARE OF OUTPUT OF THEcountry DIFFERENT GROUPS segment of MSMEs andBETWEEN the value of labor productivity of large companies a givenEUROPEAN or region. UNION: COMPARISON LATIN AMERICA ANDinTHE

LATIN OF INDUSTRIAL SECTORS ACCORDING TO THE INTENSITY OF THE EXPECTED IMPACT OF RELATIVE DOMESTIC PRODUCTIVITY 2016 The interruption of many productiveTHE acti- CRISIS According to ECLAC, “this has occurred in

80 60 70 60 50 50 40 40 30 30 20 20 10 10 0 0

vities has also generated problems(PERCENTAGES) in the segments of durable consumer goods (ausupply of domestic and imported inputs tomobiles, furniture, household applianfor those 53,5% companies that52,6% have continued ces, housing, clothing and footwear, for Latin America to operate. On the demand side, reduced example), while the impact has been minor 43,2% 42,0% European Union 39,4% Technology-intensive consumer incomes and uncertainty have or even positive for 37,3% sales of other types of resulted in a drop in consumption and a goods and services (cleaning products and Natural resource intensive change in consumption patterns. The pan- disinfectants, durable food, Internet televiLabor-intensive demic will have caused the closure of 2.7 sion and telecommunications)”. 14,9% million Latin American companies, or 19% 9,3% 8,0% Microcompanies Small companies Medium-size companies of the total number of companies. Strong impact Significant impact Moderate impact

Latin America (5 countries): share of output of the different

LATIN AMERICA SHARE according OF OUTPUTto OFthe THE DIFFERENT GROUPS OF groups (5 ofCOUNTRIES): industrial sectors intensity of the INDUSTRIAL SECTORS ACCORDING TO THE INTENSITY OF THE EXPECTED IMPACT OF expected impact of the crisis THE CRISIS

(Percentages) (PERCENTAGES)

60 53,5%

50 40

52,6% 43,2%

39,4%

42,0%

37,3%

Natural resource intensive Labor-intensive

20 10 0

Technology-intensive

14,9% Strong impact

9,3% Significant impact

8,0% Moderate impact

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official information. Nota: Los 5 países analizados corresponden a México, Brasil, Argentina, Colombia, Perú.

IMPACT OF COVID-19 ON THE DIFFERENT SEGMENTS OF AV PROJECTS IN LATIN AMERICA Tourism, culture, commerce, transportation and construction have been the most affected sectors. These account for 24.6% of GDP and 34.2% of employment. In contrast, the activities that have been least affected have been agriculture, livestock and fishing, food production, medical products and telecommunications. These activities account for 14.1% of GDP and 18.2% of employment.

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Commercial The COVID-19 pandemic has intensified several trends that were already emerging in world trade, including trade and technological tensions between the United States and China; growing economic nationalism and conflict in trade relations; the weakening of multilateral cooperation; the digitalization of production and trade; and the trend toward regionalization of production through nearshoring (location of suppliers in countries closer to the target market) and reshoring (relocation of strategic productive and technological processes to the country of origin). The value of Latin America’s exports grew 8.9 percent in the first quarter of 2021 compared to the same period last year, consolidating a change in trend after the contraction caused by the COVID-19 pandemic, according to a report by the Inter-American Development Bank (IDB). The drop in the value of external sales in 2020 was 9.0 percent. For Paolo Giordano, Chief Economist of the Integration and Trade Sector of the IDB and coordinator of

the study “Estimates of Trade Trends: Latin America and the Caribbean - 2021 Q1 Edition”, the pandemic will continue to impact domestic markets in the coming months. He added: “Importing will be fundamental to overcome the worst economic crisis of the last century”. The recovery responded to the improvement in export prices, while real flows continued to decline. The volume of Latin America’s external shipments recorded an estimated 2.2 percent year-on-year drop in the first quarter of 2021, after declining 7.8 percent in the previous year. However, some rebound has been observed in several countries in the region since March. Exports from Latin America to China increased by 34.7 percent year-on-year in the first quarter. Exports to the United States and the European Union also increased, although at a slower pace, by 3.9% and 4.0%, respectively. Intra-regional purchases from Latin America rebounded by 11.6 percent.

IMPACT OF THE PANDEMIC ON FOREIGN TRADE Change in the total value of exports in Latin America and the Caribbean in 2020* -17.6%

South America -13.9%

Latin America and the Caribbean -14.8%

Caribbean -10.3%

-15.1% -11.6% Source: ECLAC Note: 2020 forecasts* for selected countries and regions.

Central America

Brazil Mexico

Education The disruption to education has had considerable effects in areas other than education. Closures of educational institutions hinder the delivery of essential services to children and communities, such as access to nutritious food, affect the ability of many parents to work, and increase the risks of violence against women and girls. As fiscal pressure grows and development assistance comes under strain, education financing could also face significant challenges, adding to the massive education financing gaps that existed prior to COVID-19.

For low- and lower-middle-income countries, for example, that shortfall has reached a staggering US$148 billion per year, a sum that could now increase by as much as one-third. As argued by the United Nations on the current economic turmoil, “the situation is likely to contribute to widening income gaps, which will increase gender inequality. In addition, several studies estimate that the loss of working hours will account for up to 400 million full-time jobs”.

FUNDING GAP BEFORE COVID-19 TO ACHIEVE THE SUSTAINABLE DEVELOPMENT GOAL (IN MILLIONS OF DOLLARS) 6000

+18% 5,039

5000

Progress is slower than expected

3,559

More students than expected Higher unit cost of education

4000 3,400

Increased availability of data

3,010

Less time to achieve goals

3000

29%

2000

1,480

11%

1000

390 0 Total funding required

Education budget

Funding shortfall

Determination of education spending in 2015

Total funding required

Education budget

Funding shortfall

Determination of education spending in 2020, before the pandemic.

Source: UNESCO, Global Education Monitoring Report (2020). New realities for education affected by COVID Cost predictions. TOP IOO INTEGRATORS • REPORT 2021- 2022

Government In some countries, governments provided more resources, in which transfers were a crucial factor. The situation, then, has shown in the government sector, the social tensions that drag the region, having consequences such as: greater ungovernability and economic paralysis. On the other hand, the sector must face one of the main challenges for the mobilization of domestic resources to finance the implementation of the SDGs in Latin Ameri-

ca and the Caribbean, tax evasion. Also, estimates of tax evasion, aggressive tax planning by multinational companies and high net worth individuals, and illicit financial flows indicate that the resources lost are high. In the economic sphere, the challenge is to recover robust growth by promoting structural reforms capable of adapting the regional productive matrix to the demands of the fourth industrial-digital revolution. The goal is to make Latin American nations more productive and competitive.

LATIN AMERICA (16 COUNTRIES): TOTAL CENTRAL GOVERNMENT REVENUES, BY COMPONENT, 2010-2019 (AS PERCENTAGES OF GDP)

18.2

18.4

18.3

18.1

18.0

18.1

3.6

3.4

3.2

3.1

2.9

2.6

2.8

14.5

14.9

15.2

15.3

15.4

15.5

15.4

15.5

15.3

18.0

Other income 2019

2018

2017

2016

2015

2014

2013

2012

2011

Tax revenues 2010

20 18 16 14 12 10 8 6 4 2 0

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures. Note: Simple averages. In the cases of Argentina, Mexico and Peru, the figures correspond to the national public administration, the federal public sector and the general government, respectively. Argentina, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru and Uruguay.

Hospital and Pharmaceutical Although stock market theory suggests that the large pharmaceutical industries and the health sector cannot be affected by an eventual crisis, given that demand always exists, especially in a pandemic such as COVID-19, where millions in losses are evident, the harmful effect of the coronavirus on the world economy has also permeated the price of laboratories worldwide, and has slowed down mergers with other pharmaceutical companies. As a result, more than 600 (of the largest) laboratories lost 452,000 million dollars in stock market volume in the first quarter of the year, according to data extracted from the consulting firm Evaluate Pharma. The combined capitalization of these companies is USD $3,5 billions.

Part of the problem is that although there are many health systems in Latin America that have universal coverage as a declared objective, in practice numerous barriers persist, such as the very high proportion of out-of-pocket expenses as a percentage of total health spending that is observed in most Latin American countries. On the other hand, there are the out-of-pocket payments made to access services not included in the coverage plans of the different types of insurance, or to compensate for the lack of quality, comprehensiveness or timeliness of those offered by public health care, impeding or delaying care, as well as making it more costly for individuals and the system.

TOP IOO INTEGRATORS • REPORT 2021- 2022

Industrial In terms of the impact on industry, it can be said that the crisis has hit the potentially more technologically dynamic industrial sectors the hardest and, therefore, will deepen the structural problems of the region’s economies. This means that, if adequate policies are not implemented to strengthen these productive branches, there is a high probability of generating a regressive structural change that would lead to the reprimarization of the region’s economies. The impact on the industrial structure can be observed in some countries, when analyzing the performance of the first four months of 2020 compared to

the same period of 2019. Technology-intensive sectors included the production of automobiles and auto parts, other transportation equipment, electronics (final products and components), industrial machinery, medical and scientific instruments, and pharmaceuticals. Natural resource-intensive sectors include metal smelting, wood, pulp and paper, chemicals, construction materials, food, beverages and tobacco. Finally, laborintensive sectors include the production of textiles, clothing, leather, footwear, plastic products and cleaning products.

Logistics and distribution Global value chains were the main channel for transmitting the effects of COVID-19 to world trade. In Latin America, the disruption of supply chains, starting with Chinese suppliers and then with European and U.S. production, mainly affected the manufacturing sectors of Mexico, Argentina and Brazil. On the other hand, in the transportation sector, with the pandemic, the global shipping industry restructured to cope with a decrease in global freight traffic. Now, with the reestablishment of markets and the rapid increase in demand for ships and containers to transport goods, shipping companies are unable to increase their fleets at this new speed and, again, there is greater demand than supply. The adoption of the essential crisis response measures has also had a major impact on aggregate demand in the region, resulting in a sharp reduction in activity in several economic sectors. In maritime transport, projections of variations in the main items of international trade, for 2020, vary among products. Iron ore traffic would end 2020 with a growth of 1%, coal -8%, and dry bulk +5%. The variation in containers would be -7%. The drops in container traffic were marked in the months of April and May, after it was observed that in January and February the activity was still on the rise. In the accumulated period from January to June 2020, the drop in containerized ma-

ritime trade worldwide was 7%, and in Latin America almost 8%. According to ECLAC, “in the case of aviation, the drop in activity puts the industry and its workers at risk and may reduce the region’s air connectivity. The severe travel restrictions adopted worldwide have made the aviation industry one of the economic sectors most affected by the pandemic”. At the end of June 2020, air passenger traffic (RPK) and air cargo (FTK) indicators showed year-on-year1 declines of 94.2% and 40.2% respectively, while for the South American countries with updated data (Argentina, Brazil and Chile), the declines were 91.1% and 18.1%, respectively. Likewise, the Economic Commission stated in the report “Post-Pandemic International Logistics” that the maritime industry reacted quickly to the circumstances created by the COVID-19 outbreak, protecting itself with tools it had already practiced in the previous major crisis of 2008-2009. “Even so, several of the world’s major shipping lines have received or are about to receive support from their governments. The possible evolution of the pandemic and the measures that will have to be implemented to resume full air services, coupled with the precarious financial conditions of many companies prior to the pandemic, have led the airline industry into the worst crisis in its history.”

TOP IOO INTEGRATORS • REPORT 2021- 2022

CHAPTER 7 100

OUTLOOK FOR LATIN AMERICAN ECONOMIES (PANDEMICPOST-PANDEMIC)

Volatility in financial markets

By 2020, the world’s GDP is expected to shrink the most in comparison to 1946, as a result of a generalized fall in economic activity in both developed and emerging economies. Similarly, the crisis has triggered a contraction in international trade, which in turn has led to sharp fluctuations in high prices as a result of volatility in the financial markets, resulting in lower profitability and greater risk aversion.

The economic instability generated by the pandemic in international financial markets and the uncertainty in commodity markets led to strong exchange rate corrections, which gave way to considerable fluctuations in the region’s currencies during the first three quarters of 2020. Most Latin American and Caribbean currencies depreciated against the dollar. Thus, in the first ten months of 2020, 17 of the region’s economies recorded currency depreciations, with an average depreciation of 16.3%.

In addition, pandemic containment measures adopted in the vast majority of the world’s countries have had a significant impact on tourism and commercial aviation, restaurant and hotel service activities. However, the measures adopted by some of the governments of Latin American countries to deal with the effects of the pandemic have helped to mitigate the economic impact on the social and business fabric of the region. The case of the fiscal monetary packages, for amounts close to 12 trillion dollars in fiscal actions and 7.5 trillion dollars in monetary actions announcements have cushioned the fall in economic activity, but this has also caused high levels of liquidity, which has had repercussions in the increase of indebtedness at a global level.

In relation to the above, it should be noted that the variation in the nominal exchange rate against the U.S. dollar was divergent in the countries of the subregion. For example, the annual average for 2020, with respect to 2019, reports the largest depreciation in the Dominican Republic (10.2%), followed by Nicaragua (3.7%), while in Costa Rica, Guatemala and Honduras the average variation was close to zero (between 0.2% and 0.3%).

FINANCIAL MARKET VOLATILITY INDEX (JANUARY 2018 - OCTOBER 2020) 90 80 70 60 50 40 30 20

2019

Oct

Sep

Aug

Jul

Jun

May

Apr

Feb

Mar

Jan

Dic

Nov

Oct

Sep

Aug

Jul

Jun

Apr

May

Feb

Mar

Dic

Jan

Nov

Oct

Sep

Jul

2018

Aug

Jun

Apr

May

Mar

Jan

Feb

2020

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on Bloomberg Note: The VIX index, prepared by the Chicago Board Options Exchange (CBOE), measures expected volatility for the next 30 days and is obtained from the prices of call and put options on the S&P 500 index.

TOP IOO INTEGRATORS • REPORT 2021- 2022

101

Thus, if risk perception were to change and risk aversion were to increase, this would have negative effects on emerging economies in general and on Latin America and the Caribbean in particular. Emerging economies would be more vulnerable to changes in financial market access conditions, given the sharp increase in debt ratios.

EMERGING MARKETS BOND INDEX 2020 Venezuela Argentina Ecuador

219,7%

Variation vs. 28/2/20 +79 -36

14,6%

-30

10,2%

Mexico Dominican Republic

4,7%

+26

4,5%

+12

Brazil

3,1%

+22

Colombia

2,4%

+14

Source: Central Bank of the Dominican Republic. Note: “Spread” of the Emerging Markets Bond Index, known as “country risk”, in a selection of Latin American countries according to data from October 27, 2020.

According to the Institute of International Finance (IIF), the debt of governments and companies in developed countries reached 432% of GDP in the third quarter of this year, surpassing the record level of 380% of GDP recorded in 2019, while in emerging countries it reached 250%. The increase in debt was accompanied by a greater acceptance of risk by in-

7,7 % DROP IN LATIN AMERICAN GDP IN 2020, ACCORDING TO ECLAC.

102

vestors seeking higher yields. Much of the debt accumulation from the global financial crisis had been in the non-financial corporate sector, for which the disruption of supply chains and reduced global growth imply less optimal results and evidence of greater difficulty in repaying debt.

External shocks and new growth challenges for the region Thus, the magnitude of the effects of the crisis at the global and Latin American level has also been determined by structural factors such as their degree of integration in international trade and global value chains, their productive structure, demographic aspects and the level of formalization of labor markets. The region’s historical structural weaknesses and gaps, limited fiscal space, low coverage and access to social protection, high labor informality, productive heterogeneity and low productivity are central to understanding the scope of the pandemic’s effects on the region’s economies, its difficulties in implementing policies to mitigate these effects and the challenges in undertaking a sustainable and inclusive economic recovery. According to the Economic Commission for Latin America and the Caribbean (ECLAC): “ The health

A GROWTH RATE OF 5.2 % OF THE WORLD ECONOMY IS EXPECTED IN 2021, ACCORDING TO ECLAC.

emergency materialized in the worst economic, social and productive crisis that the region has experienced in the last 120 years, and in a 7.7% drop in regional GDP”. Against this backdrop, ECLAC stated: “In the global arena, despite a slight upward revision of the projections made in mid-year, in 2020 the world economy was expected to suffer a 4.4% drop and a generalized recession in countries and regions. The growth dynamics reflect, in part, a better-than-expected second quarter for some of the major economies, thanks to the boost from fiscal packages and the rebound enabled by reopenings during the third quarter.” In 2021, the said commission mentions that a rebound in the growth rate of the world economy of around 5.2% is expected. In developed economies, a growth rate of 3.9% is projected for 2021, which implies that, on average, these economies will not reach pre-crisis GDP levels next year. Similarly, and with a similar forecast, the International Monetary Fund (IMF) projects world economic growth of 5.5% in 2021 and 4.2% in 2022.

Impact on trade and value chains On the other hand, with respect to world trade, according to the World Trade Organization (WTO), a

WORLD GDP WILL GROW BY

4,2 % IN 2022, ACCORDING TO THE IMF.

9.2% drop was forecast for 2020 and a 7.2% recovery in 2021. The 2020 drop would be the deepest since the 2009 global economic and financial crisis, when it was almost 13%. “Between January and September 2020, the volume of trade fell by 7.2% compared to the same period of the previous year, although since June there had been a recovery.” It should be noted that Brazil and Uruguay recorded smaller declines in imports than the rest of the South American economies during the first half of 2020, while imports from Costa Rica, Guatemala and Nicaragua fell less than the Central American average. It is also worth noting that in the first months of 2020 there was a sharp decline in commodity prices, from May onwards this was reversing and, with the exception of energy commodities, by October prices were already above pre-pandemic levels: 5% above the December 2019 level. The IMF’s October projections point, on average, to a 9% increase in commodity prices: 4% in agri-food products, 3% in base metals and 16% in energy products. In the context of Latin America and the Caribbean, the decline in commodity prices translated into lower export prices, especially in hydrocarbon exporting countries (-19%); agro-industrial and mining exporters faced a milder decline (-3%). Export volumes contracted in all subgroups, as the international crisis reduced external demand.

THE WORLD TRADE ORGANIZATION REPORTS THAT IMPORTS OF ALL LATIN AMERICAN COUNTRIES FELL BY DOUBLE DIGITS (-26.6%) IN MOST OF THEM IN 2020.

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YEAR-ON-YEAR RATE OF CHANGE IN WORLD TRADE VOLUME (PERCENTAGES, BASED ON A SEASONALLY ADJUSTED INDEX) A.World 20 Projection WTO 2020: -9,2 2021: +7,2

13.9

15 8.9

10 7.1

6.0

4.7

4.9 1.4

0.8

2.3

2.8

1.9

3.5

1.0

0 -0.5 -5 -7.2

-10

Jan a sep 2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

-12,8 2005

-15

B. Selected regions and countries 15 10 5 0 -5 -10 -15 -20 -25 -30 -35

Ene

Feb

Mar

Abr

May

Jun

Jul

Ago

Eastern Europe and the Commonwealth of Independent States Africa and the Middle East Eurozone World United States Japan Latin America Emerging economies of Asia (excluding China) China

2020

Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of Netherlands Bureau of Economic Policy Analysis (CPB), World Trade Monitor [online database] https://www.cpb.nl/en/worldtrademonitor. - World Trade Organization (WTO), https://www.wto.org/spanish/news_s/pres20_s/pr862_s.htm.

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As for the Central American and Caribbean countries, excluding Trinidad and Tobago, the terms of trade would improve (by 5% and 3.4%, respectively) as a result of the large weight of energy in their import basket. Remittances, which are a key component of the balance of transfers, have had a heterogeneous behavior among the countries. In Mexico, the main remittancereceiving economy (accounting for more than a third of the total flows received), remittances grew by 9% up to August 2020 compared to the same period of the previous year. They have also increased in Jamaica (18%), the Dominican Republic (11%), Nicaragua (9%), Guatemala (4%) and El Salvador (1%). On the contrary, in other countries remittances have decreased so far this year: this is the case of Bolivia (-2 %), Peru (-22%), Paraguay (-16%), Costa Rica (-10%), Ecuador (-10%), Honduras (-2%) and Colombia (-1%). In the meantime, according to Balance of the Economy of Latin America and the Caribbean developed by ECLAC in 2020 it is argued, “Despite the fall in exports, the region’s current account deficit will decrease significantly (to 0.4% of GDP from 1.8% of GDP in 2019) due to the strong contraction of imports. These present the worst performance since the global financial crisis: a 14% reduction in volume terms is expected. The value of the region’s exports would contract by 13%: export prices would fall by 7% and export volumes by 6%”.

sovereign risk has tended to decrease and stabilize thanks to the strong improvements registered in September in Argentina and Ecuador. As measured by the Emerging Markets Bond Index Global (EMBIG), it reached 467 basis points at the end of October, well below the 702 basis points it closed at in April, but still above the 346 basis points it recorded at the close of 2019. Debt issuance in international markets during the first ten months of 2020 was 19% higher than in the same period last year. Sovereign bonds accounted for 40% of the total issued through October, followed by the private corporate sector (27% of the total) and quasi-sovereign bonds (20%).

BOND YIELDS IN SOUTHERN COUNTRIES Argentina 7Y 46,144 (0,000 (0,00%)) 43.300 - 43.300

50000

Chile 10Y 4,380 (+0,000 (+0,00%)) 116.323 - 116.323 Colombia 10Y 6,990 (+0,000 (+0,00%)) 104.525 - 105.005

40000 30000 20000 10000 0 -10000

Expiration date

Annual variation

Mexico 10Y 6,994 (+0,179 (+2,64%)) 107.287 - 107.401 Peru 10Y 5,407 (+0,000 (+0,00%)) 111.680 - 111.871

Source: Data taken from Investing. Own graph.

Financial flows to the region Another important aspect in the Latin American economy is the dynamics of financial flows to the region, which has been influenced by increases in global liquidity. The leading indicator of financial flows prepared by ECLAC shows that, in the third quarter of 2020, financial flows to the region continued on their recovery path, which coincides with the evolution of bond issues of the region’s countries in international markets. It is estimated that the average financial flows received by the region during that year allowed both to cover the current account deficit and to accumulate reserves. On the other hand, after the increase experienced at the beginning of the COVID-19 crisis, the region’s

GDP evolution in Latin America It is then that economic growth, in the economies of South America, fell in the first three quarters to a rate of -7.7% of GDP year-on-year, compared to close to zero growth in the same period of the previous year.

The economies of Central America went from 3.2% GROWTH RATE growthLATIN in the AMERICA: first three quarters of 2019 to aAND 5.9%LEVEL O (IN PERCENTAG contraction in the same period of 2020. In the case of Central America and Mexico, the drop in growth in the first three quarters of 2020 was 9.2%, 9.6 percen4 tage points lower than in the same period of 2019. 2 0 -2 TOP IOO INTEGRATORS • REPORT 2021- 2022 -4 -6

105

The contraction of regional GDP is explained both by the significant decline in domestic demand in each of its components and by lower external demand. In terms of aggregate demand, there were sharp declines in all of its components: consumption, investment and exports. In sectoral terms, ECLAC states that although the

current economic situation has had a negative impact on all sectors, it has done so with varying intensity depending on the sector: the most affected were manufacturing, construction, commerce and transportation, and the least affected were agriculture, essential services, financial services and mining.

LATIN AMERICA: GROWTH RATE AND LEVEL OF GDP, 2018-2020 GROWTH RATE (IN PERCENTAGES) 4 2 0 -2 -4 -6 -8 -10

Mexico and Central America Latin America South America

-12 -14 -16 -18 -20

Trim 1

Trim 2

Trim 3

Trim 4

Trim 1

2018

Trim 2

Trim 3

Trim 4

Trim 1

2019

Trim 2

2020

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures.

GROWTH BY EXPENDITURE COMPONENTS IN LATIN AMERICA Countries

Private consumption

Capital formation

Total exports 2020

Total imports 2020

(% change)

(2019) % GDP

(Millions of dollars)

Mexico

-0.7

19.40

416.999

382.985

Argentina

-0.7

14.54

54.884

37.081

Colombia

21.53

31.056

41.185

Chile

22.44

5.694

59.032

Peru

21.16

46.948

36.285

Venezuela

-24.8

21.62

5.020

6.550

Costa Rica

-4.13

17.66

12.173

14.941

Bolivia

3.7

19.87

973

7.080

Ecuador

-0.6

24.94

20.226

17.959

Paraguay

3.9

18.49

11.505

7.294

Uruguay

0.5

17.18

8.076

7.564

Dominican Republic

5.3

4.511

17.087

Honduras

3.1

22.29

4.150

9.871

Panama

2.3

40.41

10.356

15.358

Guatemala

4.3

14.51

11.513

18.206

El Salvador

1.7

19.1

5.030

1.001

Source: based on official information. Own calculations and graph.

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Future outlook From another perspective, growth projections for Latin American and Caribbean economies in 2021 are positive (subject to change due to the current situation). A regional average growth rate of 3.7% is estimated. Indeed, 3.1 points of the projected growth rate for the region in 2021 corresponds to statistical carryover, which means that 3.7% would make it possible to recover 44% of the GDP loss recorded in 2020.

The analysis presented by ECLAC at the country level indicates that Chile and Brazil are the most indebted economies in the region (263% and 229% of GDP for the third quarter of 2020, respectively). This is why liquidity expansion policies have managed to lower the cost of financing for the non-financial corporate sector. The interest rate differential for the corporate sector has narrowed substantially since the onset of the pandemic for high yield and investment grade bonds.

In the Economic Survey of Latin America and the Caribbean, 2020, ECLAC projects a scenario in which the region rebounds in 2021 and then returns to its average growth trajectory of the last decade of 1.8%. In this scenario, recovery to the 2019 GDP level would be achieved in 2024.

Similarly, the World Bank’s Global Economic Prospects report argues for a more optimistic scenario: “Regional economic activity is expected to grow by 3.7% in 2021, as pandemic mitigation”.

ANNUAL RATES OF CHANGE AT CONSTANT PRICES (2010) TOTAL GDP GDP PER CAPITA 10

Rate of change GDP

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

-5

1990

Per capita variation rate

Source: Economic Commission for Latin America and the Caribbean (ECLAC).

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GDP GROWTH RATE (2020) AND PROJECTIONS (2021-2022) December 2020

2021 projections %

2022 projections %

Growth Difference (2020-2021)

Growth Difference (2021-2022)

Brazil

-1.2

3.7

6.5

132.4

43,07

Mexico

3.1

2.5

-100

Argentina

-9.9

5.8

2.5

270.68

-132

Colombia

6.1

5.1

-19.6

-70

Chile

3.2

6.2

48.38

-106.6

Peru

0.51

8.5

3.9

-117.9

Venezuela

-30

-10

-5

-400

-300

Costa Rica

-4.5

2.9

-55.17

27.5

Bolivia

-6.2

4.4

3.5

-40.9

-25.71

Ecuador

-7.8

8.8

1.3

11.36

-576.9

Paraguay

-0.6

-85

100

Uruguay

-5.9

2.7

3.1

318.51

12.9

Dominican Republic

-6.7

4.8

4.5

239.583

-6.66

Honduras

-9

4.5

5.2

300

13.46

-17.9

2.6

7.8

788.4

66.66

Guatemala

3.6

3.1

3.4

-16.12

8.82

El Salvador

-7

4.4

240

-13.63

Countries

Panama

Source: based on official information from the region’s central banks. Own calculations and graph. Note: The difference in growth expressed in percentage units is obtained by estimating the current GDP (projection with the previous GDP).

108

9 8

Inflation

Growth

6 5 4 3 2 1

ECLAC estimated in 2020 that year-on-year (December-December) average inflation in CARD (Central America and Dominican Republic) countries stood at 2.3%, 0.4 percentage points below that recorded in 2019 (2.7%). This slowdown was the result of a significant contraction in domestic demand, which offset the supply effects related to the temporary closure of economic activities.

ua y ru g

ru U

y ra gu a

ex ic

a M

te m

az Br

Expectations for inflation in 2020 and 2021

The region’s current account deficit narrowed sharply in 2020, driven by an increase in the current account surplus, by the increase in the goods surplus as a result of a sharp contraction in imports, its decline outpacing that of exports, so the goods account surplus increased in 2020.

INFLATION EXPECTATIONS 2021

G ua

ECLAC estimates that the economies of the CARD countries will have an average growth of 4.2% in 2021, to the extent that global economic activity recovers and the internal dynamics of consumption and investment are reestablished.

In terms of trade, for 2021, the WTO expects a rebound in trade volume with a growth of 7.2 %, in line with the expected rebound in global economic activity. In this regard, there is the possibility of a somewhat better performance than predicted in the event that vaccines or treatments for COVID-19 could be distributed more quickly.

In the case of expectations for 2021, the August 2020 surveys indicate that the simple average of growth expectations increased 0.1 percentage points from 3.8% to 3.9% and the simple average of inflation decreased 0.1 percentage points from 3.8% to 3.7% with respect to the July surveys. The countries where growth expectations for 2021 increased were Brazil, Mexico, Paraguay and Peru. In the case of inflation, Brazil, Paraguay and Uruguay recorded a drop in inflation expectations.

In Central America, growth is expected to recover to 3.6% this year, supported by higher remittance inflows and stronger export demand, as well as reconstruction after two hurricanes. In the Caribbean, growth is expected to rebound to 4.5%, driven by a partial recovery in tourism.

The August 2020 expectations surveys conducted by the region’s Central Banks indicate that the simple average of growth expectations for 2020 decreased 0.1 percentage points from -5.9% to -6.0% and the simple average of inflation expectations increased 0.1 percentage points from 3.1% to 3.2% with respect to the July surveys. Changes in both inflation and growth expectations are heterogeneous among the countries analyzed.

Ch ile

Projected investment confidence and trade recovery

Source: Base information - Report “Disclosure of Expectations in Latin America” of the Inter-American Development Bank (IDB). Own calculations and graph.

In the case of expectations for 2021, this year’s May surveys indicate that the simple average of growth expectations increased by 0.2 percentage points, from 3.4% to 3.6%, and the simple average of inflation expectations increased by 0.1 percentage points, from 4.0% to 4.1%, with respect to the April surveys. The only country where growth expectations decreased was Uruguay.

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Impact on the level of investment and capital flows within the AV industry Audiovisual production and its systems are one of the most important pillars in the global economy, while at the same time it has become a sector affected by the current COVID-19 pandemic. This was stated in the “Global Screen Production: The Impact of Film and television Production on Economic Recovery from COVID-19”. The 2020 study conducted by Olsberg-SPI on the impact of COVID-19 indicates that prior to the pandemic, the growth of film production was maintained at a revolutionary pace, which has a proportional relationship with the acquisition of audiovisual equipment and integrators’ chains. In total, experts say, $177 billion was raised. On investment in the industry, Forde explained that the United States invests approximately 65% of total

110

global spending in the sector. “However, of the 65% of the spending that the U.S. does, only 40% of the investment stays there. The other regions of the world benefit from it.” Regarding the level of investment, it is important to highlight that related public policies in favor of the development of the industry play a fundamental role in capital flows. Therefore, experts mention that the situation is already being analyzed by governments in different places. Countries such as France, Sweden, Spain, Iceland, the United Kingdom and Australia already have government support and incentives. On the other hand, in Latin America, tax exemptions and payroll subsidies have been implemented, in addition to initiatives promoted by private companies in the AV industry.

EXPORT GROWTH AND TRADE BALANCE IN MEXICO AND CENTRAL AMERICA 2019 % EXPORT GROWTH 2019*

2,4%

-0,7%

3,2%

4,5%

-4,5%

Fuente: Cepal

TRADE BALANCE 2019* Mexico -7.790

Costa Rica 1.845

Guatemala -8.234

Honduras -4.388

Nicaragua -964

Panama -3.256

Dominican Republic -3.400

In US Dollars. *Estimate by ECLAC * Note: latest available data (2019). TOP IOO INTEGRATORS • REPORT 2021- 2022

111

Mexico, Central America and the Caribbean

Mexico

MEXICO: GDP AND UNEMPLOYMENT, 2018-2020

The Mexican economy will plummet by -10.2% in 2020, according to the results of the survey conducted in August 2020 by the Bank of Mexico among 36 specialists from the private and foreign sectors, coinciding with ECLAC’s estimates of a -9.0% decrease, the largest contraction of the country’s economic activity since 1932.

4 2

0 -2

-4 -6

-8 -10

-12

ECLAC estimated that inflation in 2020 would be 3.5%, due to the increase in the price of agricultural products, medical supplies, medicines, gasoline and public services, as well as the exchange rate depreciation. For its part, the unemployment rate would be at 5.1%, with a loss, between January and October 2020, of 518,609 formal jobs registered in the Mexican Social Security Institute (IMSS), compared to 2019.

-14

-16 -18 -20

T2 T3 2018

T2 T3 2019

T2 2020

UNEMPLOYMENT, 2018-2020

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

IMPORTS AV TO MEXICO

ECLAC forecasts a 3.8% growth in Mexico’s GDP for 4 6 2021. For its part, the OECD forecasts GDP growth 2 0 3.6%. at 5 -2

4 The Bank of Mexico made the projection for 2022, from 3.3% to 3%. Regarding consumer confidence, -8 3 according to seasonally adjusted figures from the -10 -12 National Institute of Statistics and Geography 2(Ine-14 gi), the Consumer Confidence Indicator (ICC) advan-16 1 ced 11.5 points in its annual comparison, reaching a -18 level of 42.7 points. -20 0 -4 -6

T2 T3 2018

T2 T3 2019

T2 2020

In the case of investment, Mexico’s attraction to caGDP, VARIATION RATE OVER 4 QUARTERS. pital flows has been maintained, with US$11.864 trillionINFLATION, in net FDIVARIATION inflows in RATE the first quarter of 2021, an OVER 12 MONTHS. increase of 14.8% and the highest amount a first UNEMPLOYMENT, VARIATION RATE OVER 12for MONTHS. quarter. Source: ECLAC, based on official data

112

GDP, VARIATION RATE OVER 4 QUARTERS.

Source: ECLAC, based on official data

From January to October 2020, the values of total merchandise exports and imports fell 12.6% and 18.8%, respectively, although the Organization for Economic Cooperation and Development (OECD) notes that exports have revived, driven by the reMEXICO: GDP AND bound in the US.

I T

35.1% USA 24.5% CHINA 11.9% GERMANY THROUGH MAY 31, 2021

Source: Descartes Datamyne – Inegi.

10.6% JAPAN 5.0% SWITZERLAND 12.9% OTHERS

Costa Rica

COSTA RICA: GDP AND UNEMPLOYMENT, 2018-2020

By 2020, the Costa Rican economy had a contraction of -4.8% of GDP due to the imposition of physical distancing measures and mobility restrictions due to the pandemic, and the fall in international trade of goods and services, according to ECLAC. This drop was the second largest contraction in economic activity since 1950, after the -7.3% decline recorded in 1982. In this regard, the OECD notes that employment in the country is beginning to recover and the unemployment rate has fallen slightly from 24.4% in July to 23.2% in August. Labor-intensive service sectors, such as hospitality, retail, transportation services, domestic services and construction, are the most affected by the pandemic. The agency forecasts a GDP recovery of 2% by 2021 and a stronger recovery (3.8%) by 2022. For its part, ECLAC estimates a 3.0% growth in 2021. On the other hand, the Central Bank of Costa Rica (BCCR) highlights an improvement in the macroecoCOSTA RICA: GDP AND nomic scenario that is reflected in various indicators UNEMPLOYMENT, 2018-2020 for the end of the year and for 2022 forecasts. It also emphasizes that the evolution of the main indicators 5 24 of 4 the external sector would be conditioned by the 22 3 recovery of the local economic activity and of the 2 20 main commercial partners. 1 18

5 4 3 2 1 0 -1 -2 -3 -4 -5 -6 -7 -8 -9 -10

2018

T3 2019

IM T 24 22 20 18 16 14 12 10 8 4 4 2 0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO COSTA RICA

0 16 -1 14 Consumer confidence was severely affected. Howe-2 12 -3 ver, for 2021, the Central Bank projects a gradual -4 10 -5 recovery of domestic demand, mainly driven by 8 the -6 4 vaccination campaign and the possibility of a return -7 4 -8 normality. Domestic demand is expected to reto 2 -9 cover, with a growth of 2.4%, on average, for 2021-10 0 T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 T3

2022.

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

45.40% CHINA 29.3% USA

14.3% HONG KONG 11.0% OTHERS

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

THROUGH MAY 31, 2021

Source: Descartes Datamyne - National customers service.

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El Salvador

EL SALVADOR: GDP AND INFLATION, 2018-2020

In 2020, El Salvador’s GDP contracted by -8.6% (versus a 2.4% expansion in 2019), due to the temporary cessation of economic activity due to the COVID-19 pandemic, according to ECLAC. This would be the third steepest decline in output since 1950, after -11.8% in 1980 and -10.5% in 1981, the years of the beginning of the civil war. The Central Reserve Bank of El Salvador indicated in September 2020 that during the first six months of the year “a contraction of -9.3% of the GDP is reflected, which did not have a greater dimension thanks to the implementation of policies aimed at supporting the income and consumption of households through cash transfers and food packages”. The country also presented a strong increase in unemployment, with the loss of some 60,000 jobs, according to data from the Ministry of Economy, raising to 8.24% the unemployment rate which had been at 6.3%.

EL SALVADOR: GDP AND

As for international trade, between January and INFLATION, 2018-2020 October 2020, exports amounted to 4.087 billion dollars, with a contraction of 18.8% year-on-year, 3 4 while accumulated imports amounted to 8.514 bi2 2 llion0 dollars, representing a year-on-year reduction -2 of 15.7%.

IMP TO 3

4 2

0 -2

-4 -6 -8

-10 -12 -14

-1 -2

-16 -18 -20

T2 T3 2018

T2 T3 2019

T2 2020

-3

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Sourc

IMPORTS AV TO EL SALVADOR

-4 -6 -8

ECLAC expects the Salvadoran economy to recover 0 by-10 3.5 % in 2021, driven by an increase in public and -1 -12 private investment, private consumption and the ex-14 ternal -2 -16 sector. Inflation will be close to 1%. -18 -20 -3 According market research T1 T2to Ipsos, T3 T4 aT1global T2 T3 T4 T1 T2 T3 com2019 2020(ICC), “El pany, on the2018 Consumer Confidence Index Salvador registered an important improvement of +18.0 points, reaching 57.3.

GDP, VARIATION RATE OVER 4 QUARTERS.

INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

114

THR

36.4% USA

7.8% PANAMA

23.9% HONG KONG

7.6% CHINA

13.0% VIETNAM THROUGH DECEMBER, 2020

Source: International Trade Center (ITC) - Central Reserve Bank of El Salvador.

Guatemala

GUATEMALA: GDP AND INFLATION, 2018-2020

ECLAC estimates that in 2020 Guatemala’s GDP will have contracted -2.5%, compared to the 3.8% growth presented in 2019, caused by the confinement measures to face the pandemic, although it estimates a 3.5% rebound by 2021. Significant efforts by the Guatemalan government to offer fiscal stimuli to companies, the creation or increase of social programs aimed at families and the reduction of tax revenues led the country to end 2020 with a deficit of 5.3% of GDP, but an external debt of 31.6%, the lowest in the region. However, inflation stood at 5.46%, almost five tenths above the upper limit of the central bank’s target range (between 3% and 5%). From January to October 2020, the value of total exports of goods decreased at a year-on-year rate of 0.1%, while that of imports fell by 11.1%. Imports of consumer goods decreased by 8% during the first eight months of the yearGDP and those of capital goods GUATEMALA: AND byINFLATION, 7.2%. 2018-2020

IM TO

6 5

1 0

1 T1

T2 T3 2018

T2 T3 2019

T2 2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Sou

IMPORTS AV TO GUATEMALA

On the other hand, regarding the consumer confi6 dence index, for this 2021 Guatemala registered an 6 improvement of +7.6 points, reaching 43.9. 5 5

In the Investment Index, an improvement of 4+3.9 points was registered, which allows it to remain in 3 3 the top third together with El Salvador (61.6), the 2 2 United States (50.2) and Puerto Rico (49.2). 1 0

1 T1

T2 T3 2018

T2 T3 2019

T2 2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

40.1% USA

10.9% VIETNAM

20.1% HONG KONG

5.7% MEXICO

14.0% CHINA

9.2% OTHERS

THROUGH DECEMBER, 2020

Source: International Trade Center (ITC)- Central Bank of Guatemala.

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Panama

PANAMA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 3

IM TO

Despite the fact that the World Bank highlighted in 2019 that “Panama has been one of the fastest growing economies worldwide”, with an average of 5% in the last five years, the pandemic collapsed the positive outlook and ECLAC estimates a contraction of -11.0% for 2020, which represents the setback of a decade for the Panamanian economy.

-5 1

-10 -15

-20 -1

-25 -30

ECLAC estimates that inflation would again be in negative territory, with a decrease of 1.0% in 2020 and 0.1% in 2019), due to weak demand, while the unemployment rate would exceed 10% at the end of the year compared to 5.8% in 2019. In terms of international trade, between January and August 2020, the value of total exports of goods fell by 23.7% compared to 2019, while imports of goods into the country (excluding the Colon Free Zone) fell by 41.2%. The largest contraction corresponds to imports of INFLATION AND capitalPANAMA: goods (52.7%),GDP, although imports of consumer goods and intermediate goods also recorded UNEMPLOYMENT, 2018-2020 3 5 significant drops in the period (39.1% and 32.4%, 0 respectively). The same agency projects that the Pa2 namanian economy will recover 5.5% in 2021. -5

-2

-35 -40

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO PANAMA

The Panamanian Consumer Confidence Index (ICCP), -15 0 in charge of the pollster The Marketing Group, ac-20 cording to last May’s measurement, reached 105 -1 -25 points, 5 units higher than the previous one, of -30 March 2021, informed the Chamber of Commerce, -2 -35 Industries and Agriculture of Panama (CCIAP). -40

-3 34.6% USA

8.1% VIETNAM

GDP, VARIATION RATE OVER 4 QUARTERS.

28.6% CHINA

9.4% OTHERS

INFLATION, VARIATION RATE OVER 12 MONTHS.

19.3% COLON FREE TRADE ZONE

2018

2019

2020

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

116

Sourc

-10

-3

THROUGH MAY 31, 2021

Source: Descartes Datamyne - National Customs Authority.

Honduras

HONDURAS: GDP E INFLATION 2018-2020

The COVID-19 pandemic significantly affected the economy of Honduras. The country’s GDP was expected to contract by 9 % in 2020 due to the pandemic and the two successive hurricanes. Some 45 % of households, according to World Bank surveys, reported income losses in August.

4 2 2

-2

IMP TO

-4 -6

-8 -10

-12 -14

Projections suggest that the proportion of people living below the $5.50 a day poverty line could rise to 55.4 percent in 2020, resulting in more than 700,000 new poor, while inequality increases slightly. From another angle, Honduras’ economy is expected to rebound in 2021 to 4.5 percent growth, amid the revival of domestic economic activity and the recovery of investment and external demand. Around trade from January to September 2020, exports of Honduran companies amounted to $3,262 million, an amount that exceeds by 0.3% what was reported in the same period of 2019, a rise that is HONDURAS: GDP E INFLATION recorded after several drops in sales, which were ge2018-2020 nerated by the health and economic crisis. 5

-16 -18 -20

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

THRO

INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS AV TO HONDURAS

4 2 2

During the third quarter of 2020, Honduras received 5 323.5 million dollars of Foreign Direct Investment -2 (FDI), -475.9 percent higher than the same period4 of 2019. -6 For this 2021, growth is associated with the 3 -8 maquila, agriculture, and construction sectors. -10 2

-12 -14

-16 -18 -20

2018

2019

2020 49.1% CHINA

17.3% USA

19.4% TAIWAN

14.2% OTHERS

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

THROUGH MARCH 3, 2020

Source: Descartes Datamyne - National Institute of Statistics (INE) of Honduras.

TOP IOO INTEGRATORS • REPORT 2021- 2022

117

Dominican Republic

DOMINICAN REP: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

After a negative year-end of -6.7% of its gross domestic product (GDP) in 2020, the economy of the Dominican Republic will reach a growth of 4.8% in 2021 and 4.5% in 2022, well above the projected growth for the region of 3.7% for this year and of most Latin American countries. Until the end of September, the Dominican economy had fallen by around 8%, especially due to the collapse of tourism, the country’s main economic sector. The rest of the sectors have been returning to economic recovery.

10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

IMP TO

8 7 6 5 4 3 2 1 T1

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS.

In the case of foreign trade, total exports of goods as of March 2021 reached some US 2,89 billion, which represented a growth of 7.5% with respect to January-March 2020, or an additional US$203.1 million. For 2021 imports show a marked inter-annual growth of 27.4% in the month of March, highlighting DOMINICAN REP: GDP, INFLATION non-oil imports with an increase of 19.4%, which is UNEMPLOYMENT, 2018-2020 in line AND with the reactivation of economic activity. In 10 8 the January-March quarter, total imports grew 9.9% 8 7 compared to the same period of the previous year. 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS AV TO DOMINICAN REP.

Likewise, foreign investment grew by 4% up to Sep5 tember, totaling US 2,066 billion for the year, and 4 remittances grew by 34%. However, inflation, which 3 accumulated an increase of 3.74%, will maintain the target set by the Central Bank of 4% with a range2of one point of oscillation in both directions. 1 0

T1 the T2 consumer T3 T4 T1 confidence T2 T3 T4 index, T1 T2 the T3 DoRegarding 2018 2019 2020 minican Republic registered an improvement of +1.5 GDP, VARIATION RATE OVER 4 QUARTERS. points, reaching 35.1. The investment index showed INFLATION, RATE OVER 12 MONTHS. an improvement of VARIATION +1.2 points.

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

118

THRO

86.41% CHINA

0.6% MEXICO

8.9% USA

2.91% OTHERS

1.2% VIETNAM THROUGH DECEMBER, 2020

Source: International trade center (ITC) - National Statistics Office, Dominican Republic.

EXPORTS AND TRADE BALANCE IN THE ANDEAN REGION AND THE SOUTHERN CONE 2019 % EXPORT GROWTH 2019* TRADE BALANCE 2019*

-3,3%

-33,3%

Colombia

Venezuela

2,1%

Ecuador Brazil -4,8%

-7%

Peru

-2,7%

-61,4%

Paraguay

Bolivia -0,8%

-6,6%

4,1%

Uruguay

Argentina

Bolivia -2.461 Colombia -12.983 Ecuador -2.586 Peru 2.493 Venezuela ND Brazil 3.128 Argentina 10.057 Chile -1.767 Paraguay 272 Uruguay 3.870 In US Dollars *Estimation by ECLAC

Chile Source: IADB and ECLAC

TOP IOO INTEGRATORS • REPORT 2021- 2022

119

Andean Region

Bolivia

BOLIVIA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

Health measures to contain COVID-19 infections led to an economic crisis that caused the Bolivian economy to contract by -8.0% in 2020, with a significant increase in the unemployment rate and moderate inflation of 1.5%, ECLAC revealed. In addition to tax deferrals (representing 1.5% of GDP), measures to address the economic crisis include transfers to different segments of the population (1.7% of GDP), credit to companies and support for employment (1.2% of GDP), as well as discounts on basic services (0.3% of GDP). The outlook for ECLAC shows that “extreme poverty will reach 16.8% this year, with a greater increase in unemployment, causing a significant deterioration in the levels of poverty and inequality”, warned Alicia Bárcena, Executive Secretary of the organization, at the end of 2020. The National Statistics Institute (INE) reported that, at the BOLIVIA: end of the third quarter of 2020, theAND unemGDP, INFLATION ployment rate was 10.76%, and although it dropped UNEMPLOYMENT, 2018-2020 to 8.39% in the fourth quarter, by January 2021 it would have risen again to 9.67%. However, ECLAC 6 6 is also optimistic for 2021, forecasting a slight recovery of 2economic activity, with growth of around5 3%, indicating that it will be limited by the “weakness -2 4 of external demand”. -6

2 -2

-6

-10

2 -14

-18 -20

T2 T3 2018

T3 2019

T3 T2 2020

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO BOLIVIA

In the first four months of 2021, imports this 2year -14 reached a value of 2,643 million dollars, an increase 1 of 361-18million (16%) over the same period of 2020. T2 T3 2018

T3 2019

T3 T2 2020

0 6.1% USA

GDP, VARIATION RATE OVER 4 QUARTERS.

9.6% VIETNAM

3.4% BRAZIL

INFLATION, VARIATION RATE OVER 12 MONTHS.

7.7% MEXICO

12.9% OTHERS

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

120

60.4% CHINA

THRO

Source:

GDP, VARIATION RATE OVER 4 QUARTERS.

-10

-20

IMP TO

THROUGH DECEMBER, 2020

Source: International Trade Center (ITC) - Pro-Bolivia

Colombia

COLOMBIA: GDP, INFLATION AND IMP TO UNEMPLOYMENT, 2018-2020

The Colombian GDP will have decreased -7.0% in 2020, according to ECLAC, added to the strong increase in unemployment and sovereign debt, reaching historic highs, which according to the Ministry of Finance, even reached 65.7% of the GDP, in order to meet the needs due to the coronavirus emergency, leaving Colombia among the “most indebted” countries in the region. However, according to export information processed by DANE and DIAN, in April 2021 the country’s external sales were US$2,914.7 billion FOB and presented an increase of 56.3 % in relation to April 2020; this result was mainly due to the 63.4% growth in external sales of the group of fuels and products of extractive industries. In the case of imports registered before the DIAN in March 2021, imports were US$4,934.8 million CIF and presented an increase of 37.5% in relation to the same month of 2020. According to the April results the Consumer OpiCOLOMBIA: GDP,ofINFLATION AND nion Survey (EOC), the Consumer Confidence Index UNEMPLOYMENT, 2018-2020 registered a balance of -34.3%.

-2

-4

-6

-8

-10 -12

-14

-16

-18

T2 T3 2018

T2 T3 2019

T2 2020

GDP, VARIATION RATE OVER 4 QUARTERS.

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS AV TO COLOMBIA

Foreign investment in Colombia grew 66% in18the 2 0 first quarter of 2021. According to the entity, 16bet-2 14 ween January and March 2021, Colombia received -4 12 33 new projects with estimated business for 1,595 -6 10 million -8 dollars, while last year in the same period it 8 -10 was 960 million dollars. -12

-14

Both-16the IMF and ECLAC are optimistic about2 the recovery for 2021, expecting GDP to rebound -18 0 to T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 T3 3.7% and 5.0% respectively. 2018 2019 2020 GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

73.0% CHINA 18.1% VIETNAM 9.3% OTROS THROUGH APRIL 30, 2020.

Source: Descartes Datamyne - DIAN.

TOP IOO INTEGRATORS • REPORT 2021- 2022

THRO

121

Ecuador

ECUADOR: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

ECLAC estimates a sharp contraction of the Ecuadorian GDP of -9.0% in 2020, in an economy that had already been showing weak growth in 2019, of only 0.1%, partly as a consequence of the social uprising of October of that year, which left losses of USD 2.8 billion according to the unions, although the Central Bank of Ecuador indicated that this figure would be around USD 821 million. The Central Bank of Ecuador estimates that by 2021 the economy will recover and grow 3.1%, equivalent to a Gross Domestic Product (GDP) of US$ 67,539 billion in constant values. Regarding foreign trade, for 2021, non-oil exports are projected to grow between 4% and 5 %. On the other hand, imports of goods and services would grow by 3.2% compared to 2020, a percentage that corresponds to USD 936.6 million. Regarding the ICC, the outlook is not so encouraging,ECUADOR: since it worsened compared to the same GDP, INFLATION AND month of 2020: it went from 37.10 points to 31.19 UNEMPLOYMENT, 2018-2020 points. On the other hand, the labor market continued to5 deteriorate between September 20195 and September 2020, with an increase of 28% in unem3 4 1 ployment and 11.6 % in underemployment in 2020. 3 Among-1 Latin American countries, ECLAC maintains -3 a very moderate growth forecast for 2021, only21%. -5

-1 -3

-5

-7 -9

-11

-1

-13 -15

2018

2019

-9

GDP, VARIATION RATE OVER 4 QUARTERS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

2018

2019

IMPORTS AV TO ECUADOR

-2

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

66.3% CHINA

6.8% HONG KONG

17.2% USA

9.7% OTHERS

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

122

THRO

Source:

-1

-13

INFLATION, VARIATION RATE OVER 12 MONTHS.

-11

-2

2020

-7

-15

IMP TO

THROUGH MAY 31, 2021

Source: Descartes Datamyne - National Customs Service

Peru

PERU: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

With a GDP contraction of 12.9%, the Peruvian economy is one of the hardest hit in the world by COVID-19, with a severe production shutdown that led to strict confinement, which lasted several months. The reason for this sharp drop is due to “the abrupt economic slowdown in the United States and China, which has disrupted supply chains in Mexico and Brazil, leading to a sharp drop in exports from commodity-producing economies such as Chile and Peru,” the World Bank stressed in a statement at the end of 2020. Peru would be one of the Latin American countries that would be “worst off” after the pandemic, suffering a sharp increase in poverty (9.3%), along with Argentina, Ecuador and Panama. Inflation, meanwhile, remained under control at 2.1%, within the target, despite the depreciation of the sol throughout the year. On the other hand, credit toAND companies PERU: GDP,although INFLATION strengthened, mainly for payments to suppliers, UNEMPLOYMENT, 2018-2020 employees and other debts, consumer credit contracted, hit by the marked deterioration of the labor 10 4 market, which reached 17.1% in the third quarter of 1 8 the year. -2

IMP TO 10

4 1

-2 -5 -8

-11 -14

-17 -20 -23

-26 -29 -32

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS AV TO PERU

-5 -8

6 ECLAC -11 estimates a rebound of 9.0% of GDP by 2021, -14 although it emphasizes that “this dynamism will be 4 -17 insufficient to recover pre-crisis GDP and production -20 levels” -23 and recovery will take even more time. 2 -26 -29 -32

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

80.0% CHINA 7.2% USA

6.1% VIETNAM 6.7% OTHERS

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

THRO

THROUGH MAY 31, 2021.

Source: Descartes Datamyne - Sunat.

TOP IOO INTEGRATORS • REPORT 2021- 2022

123

Southern Cone

Argentina The Argentine economy had been in recession since before the arrival of COVID-19, with a fall in GDP of -3%, aggravated by the pandemic, leading to a contraction of -11.8% by 2020, according to ECLAC, and although both this organization and the OECD anticipate a moderate recovery of between 3.7% and 4.9% between 2021 and 2022. Despite the above, there were negative effects on private consumption (-14.5%), exports (-8.7%) and public consumption (-5.5%), although this dynamic was also offset by the -23% drop in imports. For 2021, the Consumer Confidence Index at national level increased 0.3% with respect to April’s record and accumulated a contraction of 7.8% in the inter-annual comparison. On the other hand, inflation reached 43.5% yearon-year in the accumulated to October, compared to the 2019 average (53.5%), associated with the ARGENTINA: GDP, prices. INFLATION freezing of regulated product Unemployment rose to 13.1% in the second quarter AND UNEMPLOYMENT, of 2020, although ECLAC expects this indicator to improve 2018-2020 in 2021.6 55 4 2

4 2

50 40 35

-4 -6 -8

30 25

-10 -12 -14

20 15 10 5

-16 -18 -20

T2 T3 2018

T2 T3 2019

T2 2020

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO ARGENTINA

30 25 20 15 10 5

-16 -18 T1

T2 T3 2018

T2 T3 2019

T2 2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

THRO

Source

-14

GDP, VARIATION RATE OVER 4 QUARTERS.

-10 -12

IMP TO

0 -2

-4 -6 -8

124

0 -2

-20

ARGENTINA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

55.0% CHINA

3.3% USA

25.2% VIETNAM

1.6% BRAZIL

5.8% MEXICO THROUGH DECEMBER, 2020

Source: International Trade Center (ITC) - National Institute of Statistics and Census

Brazil Brazil’s Gross Domestic Product (GDP) grew 7.7 % in the third quarter of 2020 compared to the previous three months. However, compared to the same period in 2019, the indicator shows a 3.9% decline. The Organization for Economic Cooperation and Development (OECD), foresees a decline of 6 % and an expectation that the country will reach 2022 without having recovered the GDP of before the pandemic. At the same time, the entity highlighted Brazil’s fiscal and monetary response to the crisis, but warned that recovery will take time to consolidate without structural reforms to improve productivity. However, by 2021, Brazil’s economy generated 280,666 formal jobs. This is a significant increase over the previous year. According to official information, in May 2020, the balance had been -373,888. Additionally, the Brazilian Gross Domestic Product (GDP) grew by 1.2% in the first quarter of 2021, compared to the previous three months, according BRASIL: GDP, to data published by theINFLATION Brazilian Institute of Geography and Statistics (IBGE). AND UNEMPLOYMENT,

2018-2020 4

-2

-4

-6

-8

-10

-12

T3 2018

T3 2019

-2

-4

-6

-8

-10

-12

2018

T3 2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

2020

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

IMPORTS AV TO BRAZIL

68.7% CHINA 15.2% VIETNAM 16.01% OTHERS THROUGH MAY 31, 2021

Source: Descartes Datamyne – Aladi.

TOP IOO INTEGRATORS • REPORT 2021- 2022

Sou

GDP, VARIATION RATE OVER 4 QUARTERS.

Source: ECLAC, based on official data

IM TO

BRASIL: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

125

Chile In 2020, Chile faced one of the worst economic crises in its history since 1982, with a contraction of the economy of -6.0%, which began with the social crisis experienced in the country in the last quarter of 2019 and which worsened due to border closures, quarantines and the suspension of many economic activities to control the advance of COVID-19, leading to a fall in domestic demand, a lower level of production and increased unemployment.

CHILE: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

IMPO TO C

7 5 3 1

-1 -3 -5 -7 -9 -11 -13

Although initially agencies such as the IMF and ECLAC estimated contractions of -7.9%, as of the fourth quarter an incipient recovery of activity is observed due to the gradual withdrawal of sanitary measures and as an effect of economic measures, allowing a slight recovery at the end of the year, and ECLAC and OECD now estimate a GDP recovery of between 4.2% and 5% for 2021. According to figures from the Foreign Trade Report prepared by the Studies Department of the National CHILE: GDP, INFLATION Customs Service, between January and April 2021 UNEMPLOYMENT, thereAND were again encouraging figures for foreign trade,2018-2020 with Chile’s trade exchange with the world 7 14 growing by 25.6% to USD 51,2 billion.

-15

2018

2019

T2 2020

INFLATION, VARIATION RATE OVER 12 MONTHS.

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO CHILE

13 12 3 11 For this same period, the country’s exports reached 1 10 USD 28,7 billion, with an increase of 21.4% in9rela-1 8 tion to -3 the same period of 2020. Imports, meanwhi7 -5 le, totaled USD 24,3 billion, an increase of 32.1%. 6 -7 5 4 -9 The Faculty of Economics and Business of the3 Uni-11 versidad del Desarrollo (UDD) together with 2 AM-13 1 CHAM, -15 presented the second version of the Foreign 0

Source: ECLAC, based on official data

126

GDP, VARIATION RATE OVER 4 QUARTERS.

T3 T1 T2 T3 T4 T1 T2 T3 T4 T1 Direct Investment Confidence Index inT2Chile, with 2018 2019 2020 the participation of 190 companies from different GDP, VARIATION RATE OVER 4 QUARTERS. countries of origin and economic sectors, equivalent INFLATION, VARIATION RATE OVER 12 MONTHS. to 55% of the foreign direct investment that arrives UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. in the country.

14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

66.7% CHINA 22.6% VIETNAM 10.7% OTROS THROUGH MAY 31, 2021

Source: Descartes Datamyne - National Customs Service.

THROU

Source: D

Paraguay The Paraguayan economy will end 2020 with a contraction of -1.6%, thanks to a decisive fiscal policy response to contain the COVID-19 pandemic, although this will result in a deterioration of the central administration’s fiscal deficit of 6.5% of GDP, ECLAC indicated. The Central Bank of Paraguay (BCP) indicated that the GDP contraction was only 0.6%. Economic activity contracted by -0.9 % during the first half of 2020, due to the impact of the sanitary measures to face the crisis. This dynamism leads ECLAC to estimate a 3.5% growth in Paraguay’s GDP for 2021, which will result in a slight rise in inflation, which will remain within the government’s target range. In the same year, foreign trade operations recorded positive data, according to the Central Bank of Paraguay (BCP). Total exports as of April 2021 reached a valuePARAGUAY: of US $4,2 billion, 16.4%INFLATION higher than the US GDP, $3,6 billion as of April 2020.

AND UNEMPLOYMENT, On the2018-2020 side of imports up to February 2021 they had

IMP TO

PARAGUAY: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 10

-2

-4

-6

1 0

-8 T1

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS AV TO PARAGUAY

9 10 US $1,697.8 million, 12.7% lower compared reached 8 8 to the same period of the previous year. 6

According to the Central Bank of Paraguay, Foreign 2 5 Direct Investment (FDI) grew by 8.9% during 2020, a 4 0 positive figure considering the context of the global 3 -2 health -4crisis and the consequent economic and com2 mercial-6 stagnation generated at international level. 1 0

-8 T1

2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

THRO

71.5% USA

3.3% VIETNAM

16.7% CHINA

1.0% LETONIA

5.9% HONG KONG THROUGH DECEMBER, 2021

Source: International Trade Center (ITC) - Central Bank of Paraguay.

TOP IOO INTEGRATORS • REPORT 2021- 2022

127

Uruguay Although the Uruguayan country did not have a contraction in its GDP as strongly as other countries in the region, ECLAC estimated that there was a decrease of -4.5% in 2020 and projects a recovery of 4.3% for 2021.

URUGUAY: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 4

IMPO TO U 12

2 0

-2 -4

Foreign trade was one of the main factors driving the recovery of the Uruguayan economy during the last quarter of 2020, a trend that would continue in the first quarter of 2021, added to the fact that during the second quarter of 2020 the construction of the country’s third pulp mill began, “so it is possible that private investment, very depressed in the last six years, will become active again”, ECLAC predicted. However, the unemployment indicator had been increasing since the months prior to the pandemic, and as of September it stood at 11%, two points higher than in the same month of 2019. In theURUGUAY: first quarter of GDP, 2021, exports totaled US $2,1 INFLATION billion, which implies an increase of 19.3% over what AND UNEMPLOYMENT, was exported in the first quarter of 2020.

2018-2020

-6

-8 -10 -12

2018

T3 2019

INFLATION, VARIATION RATE OVER 12 MONTHS.

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS AV TO URUGUAY

-10 T1

T3 2018

T3 2019

2020

13,2% VIETNAM

INFLATION, VARIATION RATE OVER 12 MONTHS.

16,7% OTHERS

Source: ECLAC, based on official data

128

70,1% CHINA

GDP, VARIATION RATE OVER 4 QUARTERS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

GDP, VARIATION RATE OVER 4 QUARTERS.

The Consumer Confidence Index (CCI) for the month 2 of May 2021, prepared based on surveys in Uruguay, 0 shows an increase of 1.6 points. With a score of 849.7 -2 in May, although the index still remains at the mo-4 derate pessimism level, it is very close to the limit of -6 4 to moderate optimism (from 50 points). Compared -8 May 2020, the index is 4.1 points higher. -12

2020

THROUGH MAY 31, 2021

Source: Descartes Datamyne - National Customs Service

THROU

Source: D

TOP IOO INTEGRATORS • REPORT 2021- 2022

129

CAPÍTULO 8 130

EXPANSION OPPORTUNITIES FOR THE AV INDUSTRY IN LATIN AMERICA

Outline of telework in Latin America Countries in the region that use it the most

Relevant data

México 49% of companies in the region use cloud services.

Colombia Brazil

Generations that have adopted it Generational framework Millenials Generation X

Chile

Baby Boomers 4%

58% of companies in Latin America do not offer job mobility

By 2020, it is expected that 50% of jobs will be remote

54% of companies implemented teleworking at the request of their employees.

9% 87% Fuente: Citrix

The control and mitigation of the COVID-19 is largely supported by the use of mobile applications and information systems supported by digital technologies, which are integrated with different audiovisual systems. These have ensured greater transparency and reliability of information for users. Also noteworthy stand out initiatives that measure the spread of the virus, constantly update the number of people affected, disseminate information in real time and facilitate diagnosis, prevention and mitigation schemes, and in general contribute to flattening the infection curves. In addition to others

that facilitate teleworking, contribute to health and generate spaces through automation and the use of AV equipment. According to the Economic Commission for Latin America and the Caribbean (ECLAC), “a quick review of these types of initiatives reveals the enormous opportunity that Latin America and the Caribbean have to act at this juncture in terms of public apps for detection, control and monitoring of the virus, to more sophisticated models supported by more disruptive technologies such as drones, data analytics platforms, artificial intelligence, 5G and robots, among others”. TOP IOO INTEGRATORS • REPORT 2021- 2022

131

With regard to telecommunications infrastructure and digital connectivity, the entity states that among the clearest indicators are the exponential increase in Internet traffic (and the consequent challenge for operators to preserve adequate quality levels), the importance of teleworking, and the need to maintain active supply and distribution chains of goods such as the implementation of AV integration systems.

necting to China increased 22 times since the beginning of the pandemic, while the number of users in Japan, South Korea and Singapore increased four to five times. The natural increase in the number of connected devices in the home, using video conferencing and cloud work platforms, has created a bottleneck in wifi routers operating over unlicensed spectrum.”

Networks, therefore, remain a central element to enhance these systems and, in turn, the integration of a country’s economic and territorial system. It is then that networks are evolving rapidly with advances in information technology and communications, as well as integrated systems of Audio and Video, generating capabilities for data collection, processing and analysis that allow better planning, management and development of new services on infrastructure that can be important allies in emergencies.

This information allows us to compare traffic with Latin America, where broadband speed and latency in March 2020 showed high volatility, probably reflecting peaks in Internet access, combined with changes in behavior and traffic flow (from the workplace or study to home).

Additionally, a great opportunity lies in the emphasis on high capacity networks such as 4G Advanced and 5G, without forgetting the development of IXP infrastructure that ensures better latency and lower internet connection costs. Beyond the impact on telecommunications networks, teleworking has generated impacts on videoconferencing applications and data traffic within the home based on wifi technology. According to ECLAC, “the traffic of Webex, Cisco’s platform, con-

132

For example, fixed broadband speed presented itself as follows: stable speed in Brazil and Mexico with a gradual decrease per week in March, marked speed decrease in Chile in the month of March 2020; constant decrease in Ecuador from February to the last week of March. On the fixed broadband latency side, there was a gradual increase (and therefore erosion of the quality of service) in Brazil the increase was 11.7%, in Chile 1.0%, Ecuador presented 11.8% and Mexico had an increase of 7.4%. Mobile broadband speed was stable in Brazil and Mexico. While in Chile there was a (notable) decrease and in Ecuador, there was a gradual reduction.

Increase in wifi traffic (December 2019-April 2020).

0.18

Much Higher Upload Traffic and created mostly by Laptops and PCs

16 14 12 10 8

Effect of Video Calls Effect Work Form Home

0.17

Upload / download Ratio

Phone / PC Upload Traffic (MB)

0.19

Aumentó 80%

0.16 0.15 0.14 0.13 0.12 0.11

Dec 2019

Dec 21 Jan 5 2019 2020

Jan 2 2020

Feb 2 Feb 10 Mar 1 Mar 15 Mar 29 2020 2020 2020 2020 2020

Nov 2019

Dec 2019 Ene 2020 Feb 2020

Mar 2020 Abr 2020

Note: As of the end of March traffic statistics compiled based on data from 125 million Wi-Fi routers. This indicates an 80% increase in PC uploads to the cloud, as well as spikes caused by video conferencing calls.

Teleworking and access to technology and AV tools On the telework side, ECLAC argues in the report “Universalizing access to digital technologies to address the effects of COVID-19” that website traffic and the use of telework applications, online education and online shopping reveal a significant increase in the use of digital solutions. Between the first and second quarters of 2020, the use of telework solutions increased by 324% and online education by more than 60%. Before the pandemic, 7.9% of the world’s workers worked permanently from home, mainly in traditional manufacturing and craft occupations, but only a minority did so through telework. According to the commission, “the proportion of

work that can be performed remotely varies between countries for structural reasons”. The percentage of jobs that can migrate to telework is positively linked to the level of GDP per capita and lower degrees of informality. In the case of Latin America and the Caribbean, ECLAC estimates that around 21.3% of the employed could telework. In the region, the percentage of occupations in which teleworking could be possible is conditioned by high levels of informality, which in 2018 reached more than 50% of total employment. Most informal employment is concentrated in sectors that require physical interaction, so it cannot be developed remotely. TOP IOO INTEGRATORS • REPORT 2021- 2022

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Latin America (5 countries*): changes in the level of activity by sector between the first and second quarter of 2020, based on website traffic and app usage (In percentages) Telework (worldwide)

324

E-commerce and delivery

157

Online education

Direct video and audio over the Internet

Banca electrónica

Retail e-commerce

Hospitality and lodging (worldwide) Travel and tourism -150

-7 -93 -100

-50

100

150

200

250

300

350

Source: Economic Commission for Latin America and the Caribbean (ECLAC). Note: The hotel and lodging and telework categories include global data, since the sites cannot be associated with users in a given country. Telework applications include: zoom. us, meet.google.com, teams.microsoft.com, webex.com, and slack.com. * The information used corresponds to: Argentina, Brazil, Chile, Colombia and Mexico.

In response to the problems and the suspension of classes and remote work, connectivity was introduced. This allowed for continuity, however, according to UNESCO and IESALC, until the arrival of COVID-19 in the case of Latin America and the Caribbean, only one out of every two households was connected. In relation to the above, it should be noted that household connectivity rates are very uneven in Latin America, with extremes in Chile and Bolivia, where mobile line rates are extremely high and exceed, in many cases, the figure of one line per person. This is undoubtedly an opportunity for the AV industry, focusing efforts on technological solutions for the use

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of APP, integrated systems. It is noteworthy the percentage of people employed in jobs that can be developed telematically and can not work from home due to the level of connectivity in the country. For example, in the Dominican Republic, low connectivity reduces the percentage of employees who could telework by 11 percentage points. In countries with better connectivity, such as Chile and Uruguay, the percentage of workers who could not work remotely “for this reason” is reduced by 1 percentage point and 3 percentage points, respectively.

Labor competitiveness in Latin America 2020 Digital Competitiveness Index score. (100= most competitive)*

Puesto en el ranking 61,52

Chile

Brazil

52,10

Mexico

51,51

Peru

Argentina

Colombia

Venezuela

50,12 48,78 46,45 23,99

*It measures the capacity of 63 economies to adopt and explore digital technologies. It assesses three pillars: technology, knowledge and future readiness.

AV integration systems for telehealth In 2015, 56 % of the countries in the region had a national policy or strategy in place for the electronic delivery of health services. However, only 38 % of these countries had a specific regulation for di-

gital data exchange between health services, highlighting the need for a central component of the enabling regulatory framework.

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Uruguay

Dominican Republic Trinidad y Tobago

Peru

Paraguay

Panama

Mexico

Jamaica

Honduras

Guatemala

El Salvador

Cuba

Costa Rica

Colombia

Policy or legislation

Chile

Argentina

Latin America and the Caribbean (16 countries): regulatory frameworks for the electronic delivery of health services, 2015*.

Medical jurisdiction, liability or reimbursement for electronic health services. Safety and quality of patient care based on data quality, data transmission or clinical competency criteria. Privacy of personally identifiable data. Privacy of health-related data. Exchange of digital data between health professionals in other countries. Exchange of personal and health data between research entities. Individual electronic access to health-related data. Ability of individuals to demand correction of health-related data. Ability of individuals to demand the deletion of health-related data. Capacidad de las personas para exigir la eliminación de datos relacionados con la salud Ability of individuals to choose what data can be shared. Civil registration and vital statistics. National identification management systems.

yes

Sin información

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on data from World Health Organization (WHO), Global Observatory on eHealth. *Latest available data.

According to data from the World Health Organization as of 2016, 61 % of them had a national digital health strategy. However, 5 years later, the need to move from the phase of policy and strategy formulation to implementation is still latent. In comparison, for this last year mentioned, it should be noted that 52.6% of the countries had an electronic health information system (HIS), the main barriers to its implementation being the lack of resources for its financing (73% of the cases) and the lack of data related to the effectiveness of telehealth programs and information on their costs (63% of the cases).

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Against this backdrop, ECLAC describes that “there is a need to move towards an evolution of the doctor-patient relationship, taking advantage of the intensive use of existing digital platforms and tools for self- and remote monitoring, treatment when possible, and post-discharge follow-up”. In addition, ECLAC emphasizes that these AV systems are important for the online training of health workers who, in crisis scenarios, need to know and effectively apply special protocols and which can be developed through different systems of audiovisual integration, automation, etc.

Audio and video conferencing, the tool to strengthen the medical appointment management system ECLAC in the report “The opportunities of digitalization in Latin America facing COVID-19”, exposes that from its simplicity and knowing in advance by the specialists a series of recurrent symptoms, a patient can be interviewed without the need to travel. “This solution, added to an appointment management system and a platform for electronic transmission of images/files (Teleradiology), makes remote control and follow-up feasible”. Another key issue, as already mentioned above, is the availability of broadband access for both users and health centers, which, especially in extra-urban or rural areas, are major barriers. In relation to the above, the consulting firm Oliver Wyman, in its report COVID-19: Telehealth is the New Front Door, states that 65% of users are willing to use telemedicine, although only 8% have done so so so far, which speaks of a huge opportunity to adopt these services and the sales option for integrated VA systems.

65 % OF USERS ARE WILLING TO USE TELEMEDICINE

“The data shows that users are increasingly interested in adopting these types of services. The pandemic created awareness among authorities and users of the relevance of digitizing healthcare services, which requires robust networks and extending connectivity to the entire population,” the report adds.

Use of telemedicine systems (last two years)

10 000

Costumers

7 500

5 000 2 500

Pre-Pandemic

Start of quarantine

During quarantine

Source: Medical Software (MEDESK). Note: Statistics are based on the number of clients using the Latin American Medesk software. Pre-pandemic only 9% of clients used telemedicine systems. Before quarantine 15% of them implemented telemedicine. During quarantine 60% of clients worked with telemedicine. TOP IOO INTEGRATORS • REPORT 2021- 2022

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Technological trends to improve teleworking According to AV Consulting, a multinational engineering and consulting firm specializing in Latin America, “audio quality is directly related to the intelligibility and clear understanding of the human voice during a conference call. For this reason, the equipment and the overall solution must ensure the best treatment of the audio signal “. In addition, he mentions: “some of the latest technology options available on the market today are specialized audio processors for conference with noise cancellation technology and multichannel digital series microphones for ceiling installation with tracking technology and audio signal processing”. As for home office environments (remote work from home) states: “the conditions are variable. Although acoustically we have a lower room volume and a smaller influence of the surfaces of the room, the background noise tends to be higher (which implies greater demand to eliminate disturbing sounds in conferences)”. On the other hand, it should be noted that there are

two important components in the video solution: the capture and display (referring to cameras and displays) and collaborative capabilities (which refers to screen sharing functions, viewing files and annotations). It is also important to note that according to different experts consulted, “at this time in the industry there are integrated solutions All-in-One and simplified solutions that allow incorporating multiple technologies: video switchers in high resolution for corporate applications, interactive displays with the ability to share multiple video streams wirelessly and specialized AV processors for auditoriums and large format rooms”. In the corporate sector (considering that these technologies can be applied by multinational corporations, private sector companies and public organizations at all levels) the need to maintain optimal communication processes remains latent; which opens a wide window of opportunity for professional audiovisual integrators who can offer and implement robust and efficient systems.

Audio and video quality has become a very important aspect of the day-today operational activities of all teams and staff sections (sales, engineering, etc.). Every day, virtual meetings are becoming more extensive and have acquired greater value in making business, organizational and financial decisions in any company.

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There are multiple solutions on the market for portable and personal use that can optimize the audio experience: specialized conference headsets and compact high quality microphones with USB connection.

Growth of residential automation On the other hand, studies on the home automation and residential automation market confirm the positive outlook for this sector, with growth forecasts up to 2025. For example, in the report Smart Home Automation Market by Application, prepared by Market Research, the global smart home automation market is estimated to exceed USD 94 billion by 2025, by growing at a CAGR of over 12% during the forecast period 2020-2025. Zion Market Research, in its report indicates that the global home automation market demand was valued at around USD $47 billion in 2018, and is expected to reach approximately USD $101 billion by 2025, at a CAGR of slightly over 11.50% between 2018 and 2025. He explains this growth in relation to “the shift in customer focus from traditional homes to smart ho-

mes and on the luxurious and elegant lifestyle. In addition, increased awareness about energy efficiency, sharp rise in electricity prices, and technological advancements are expected to fuel the growth of the home automation market.” However, MarketsandMarkets in its study projected growth from USD $40.8 billion in 2020 to USD $63.2 billion in 2025; it is expected to grow at a compound annual growth rate of 9.1% from 2020 to 2025. It is worth noting that the studies highlight the global market figures, in which it is estimated that the Latin American residential market occupies between 8% and 10% of the global market. Faced with them, experts agree that in all countries of the region the residential automation sector has grown, highlighting the Caribbean, where there are greater job opportunities.

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Index of references Sources cited: Inter-American Development Bank (IDB), “Disclosure of Expectations in Latin America,” June 2020. Inter-American Development Bank (IDB), “Latin America overcomes commercial impact of pandemic,”Press publication, June 3, 2021. Inter-American Development Bank (IDB), “Education in times of the coronavirus”, May 2021. World Bank (WB), “World Economic Outlook: Latin America and the Caribbean,” January 2021. Clacso Library, “Policies and audiovisual production in the digital era in Latin America”, 2019. Economic Commission for Latin America and the Caribbean (ECLAC), “The effects of COVID-19 on international trade and logistics,” August 6, 2020. Economic Commission for Latin America and the Caribbean (ECLAC), “Latin America and the Caribbean Facing the COVID-19 Pandemic Economic and Social Effects,” April 3, 2020. Economic Commission for Latin America and the Caribbean (ECLAC), “Preliminary Overview of the Economies of Latin America and the Caribbean, 2020” (LC/PUB.2020/17-P/Rev.1), Santiago, 2021. Economic Commission for Latin America and the Caribbean (ECLAC), “Preliminary Overview of the Economies of Central America and the Caribbean de las economías de Centroamérica y la República Dominicana en 2020 y perspectivas para 2021: febrero de 2021 (LC/MEX/TS.2021/2), Mexico City, 2021. Economic Commission for Latin America and the Caribbean (ECLAC), “Sectors and companies facing COVID-19: emergency and reactivation”, July 2, 2020. Economic Commission for Latin America and the Caribbean (ECLAC), R. Sánchez and F. Weikert, “Logística internacional pospandemia: análisis de las industrias aéreas y de transporte marítimo de contenedores”, Comercio Internacional series, No. 162 (LC/TS.2020/190), Santiago. Economic Commission for Latin America and the Caribbean (ECLAC), “Las oportunidades de la digitalización en América Latina frente al COVID-19”, 2020. Economic Commission for Latin America and the Caribbean (ECLAC), “Universalizar el acceso a las tecnologías digitales para enfrentar el COVID-19”, August 2020. National Administrative Department of Statistics (DANE), “En el primer trimestre del 2021pr el Producto Interno Bruto de Colombia crece 1,1%”. Press publication, May 14, 2021. El Economista, “Al cierre del 2020 deuda global sumará 277 bdd: IIF”,Press publication, November 19, 2020.

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International Monetary Fund (IMF), “WORLD ECONOMIC OUTLOOK: MANAGING DIVERGING RECOVERIES,” April 2021.

Organisation for Economic Co-operation and Development (OECD), “Tax Statistics in Latin America and the Caribbean 2021”, OECD Publishing, Paris, 2021. Organisation for Economic Co-operation and Development (OECD), “Jobs must be at the heart of recovery to avoid serious fallout in the economy and society, says OECD,”Press publication, July 7, 2021. World Trade Organization (WTO), “Trade plummets as COVID-19 pandemic disrupts global economy,”Press publication, April 8, 2020. World Trade Organization (WTO), “Trade shows signs of reviving after COVID-19 effects, but recovery remains uncertain,” Press publication, October 6, 2020. United Nations, “Policy Report: Education during COVID-19 and beyond,” August 2020. Portfolio, “Capital flows continue to return to the region,” Press publication, November 5, 2020. Databases: International Trade Center (ITC). With information from UN Comtrade (United Nations Trade Statistics Database) and official sources: • El Salvador: Central Reserve Bank. • Guatemala: Central Bank of Guatemala. • Paraguay: General Directorate of Customs. • Dominican Rep.: UN Comtrade.

Descartes Datamyne. With information from official sources and partner countries: • Argentina: General Directorate of Customs. • Brazil: Latin American Integration Association (Aladi). • Chile: National Customs Service. • Colombia: National Tax and Customs Directorate (Dian). • Costa Rica: National Customs Service. • Ecuador: National Customs Service. • Honduras: General Directorate of Customs Franchise Control. • Mexico: National Institute of Statistics and Geography of Mexico (Inegi). • Panama: National Customs Authority. • Peru: National Superintendence of Customs and Tax Administration (Sunat). • Uruguay: General Directorate of Customs. Federación Latinoamericana de Bancos (Felaban), Indicadores Tasa de cambio (con respecto al dólar de EE. UU.), official website (http://indicadores.felaban.net), data as of June 2018.

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Harmonized tariff classification codes (HS-code) analyzed*: HS-Code** Description 85 Electrical machinery and equipment and parts thereof; sound recorders and reproducers; television image and sound recorders and reproducers, parts and accessories of such articles. 8517 Telephone sets, including telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data (including wired/wireless networks), excluding items of 8443, 8525, 8527, or 8528. 8517.69 Communication apparatus (excluding telephone sets or base stations); machines for the transmission or reception of voice, images or other data (including wired/wireless networks), n.e.c. in item no. 8517.6 8518 Microphones and their stands; loudspeakers, mounted or not in their enclosures; headphones and earphones, combined or not with a microphone, and sets of a microphone and one or more loudspeakers; audio frequency and electric sound amplifiers and sets. 8518.10 Microphones and stands therefor. 8518.21

Loudspeakers; single, mounted in their enclosures.

8518.22

Loudspeakers; multiple, mounted in the same enclosure.

8518.29

Loudspeakers; not mounted in their enclosures.

8518.40

Amplifiers; audio-frequency electric.

8518.50

Amplifier sets; electric sound.

8519

Sound recording or reproducing apparatus.

8519.81

Sound recording or reproducing apparatus; using magnetic, optical or semiconductor media, n.e.c. in item no 8519.20, 8519.30 or 8519.50. Sound recording or reproducing apparatus; n.e.c. in heading no 8519. Video recording or reproducing apparatus. Video recording or reproducing apparatus; other than magnetic tape-type. Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders. Television cameras, digital cameras and video camera recorders. Monitors and projectors, not incorporating television reception apparatus; reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus. Monitors; other than cathode-ray tube; capable of directly connecting to and designed for use with an automatic data processing machine of heading 84.71. Monitors other than cathode-ray tube; n.e.c. in subheading 8528.52, whether or not in color. Projectors; capable of directly connecting to and designed for use with an automatic data processing machine of heading 84.71. Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus; not designed to incorporate a video display or screen.

8519.89 8521 8521.90 8525

8525.80 8528

8528.52 8528.59 8528.62 8528.71

142

8528.72

9405

9405.10 9405.40

Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus; incorporating a color video display or screen. Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, n.e.c.; illuminated signs, illuminated name-plates and the like; prefabricated buildings Lamps, light fittings; including searchlights, spotlights and parts thereof, n.e.c.; illuminated signs, name-plates and the like, having permanently fixed light source and parts thereof n.e.c. or included. Chandeliers and other electric ceiling or wall light fittings; excluding those used for lighting public open spaces or thoroughfares. Lamps and light fittings; electric, n.e.c. in heading no. 9405.

For the tables and graphs of imports by companies and equipment of Chapter 1, only the tariff classification codes of products related to Audio and Video equipment were taken, for transactions carried out until August 31, 2021. ** It is important to note that these tariff classifications include professional Audio and Video equipment, components and spare parts together with consumer products, since the customs agencies of each country do not differentiate between both types of equipment and components when processing imports. Technical Data Sheet Survey “TOP BRANDS IN LATIN AMERICA”. Data collection dates: Until August 31, 2021. Data collection technique: Online survey on the Encuestados.com platform. Method: Multiple choice questions. Subjects covered: Selection of one or more of the AVI equipment brands most commonly used by integrators. Target group: The companies of the Top 100 Latin American Integrators 2021. Survey developed by Latin Press, Inc.

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144 94