Information Technology landscape in PORTUGAL
Analysis: IT Strengths and Weaknesses
Does Portugal have a competitive advantage in IT?
Inherently, Portugal has not possessed a
competitive advantage to other countries in manufacturing, design or research
and development of information technology, but it is making efforts to
create IT incubators. Currently, other countries possess similar or better
qualities, especially in the development of technical, professional labor.
However, when considering the entire package of government support, the
fiscal environment, Portugal's economic growth, low inflation, low labor
costs and most importantly, its important location at the crossroads of
Europe and Africa, Portugal can exploit the benefit of being the lowest-cost
producer within the European Union and a prime location for exporting.
Areas to leverage are:
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Low cost, flexible labor that is trainable in lower-level technical areas
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Government spending on and support of infrastructure
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Training and technical skills in automation, automotive assembly and automotive
component manufacturing
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Establishment of research parks
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Major spending on educational reform, especially in improving science and
technology aptitudes
Strong IT areas:
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Recently, Portugal Telecom jumped into high gear, upgrading its basic
telecommunications infrastructure in order to help Portugal compete in
the global marketplace. Portugal boasts the highest per capita investment
in telecommunications infrastructure in the EU. Today, 100% of international
telecommunications use digital switching. By the end of 1995, almost 75%
of local phones also enjoyed the same advanced technology. More than 1,800
miles of fiber optic cable interconnect the major urban centers-from Porto
in the north to Faro in the Algarve-and more is planned for the future.
As of 1996, 5,000 miles of high tech fiber optic transmission cable provides
a data, voice and video link from most Portuguese cities, towns and villages
to Spain and the entire EU.
To underline the extent of Portugal's advanced technological infrastructure,
one need only look at the country's "electronic purse" system. The system
is based on Portugal's decade-old electronic payments network, called Multibanco,
which has allowed every Portuguese citizen to enjoy up to 26 services through
more than 3,500 ATM machines around the country-from booking airline and
train tickets, to settling utility bills, from managing investment portfolios
to paying income taxes. Today, Portugal's forward-thinking mind-set and
fiber optic capabilities have allowed it to become the leader in the development
of the "electronic purse" system. An "electronic purse" is a plastic bank
card embedded with a computer chip, which replaces the need for cash when
making payments and transactions. The Financial Times has called both of
these networks the most advanced and only globally compatible electronic
payment systems in the world.22
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