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Study: Puerto Rico is digitally competitive in the Americas but lags globally

This is according to the 2024 World Digital Competitiveness Ranking published by the International Institute for Management Development.

Puerto Rico is the fourth most digitally competitive economy in the Americas and ranks 44th among 67 countries, a new ranking shows.

The island followed the U.S., Canada and Chile in the region and beat Brazil, Colombia, Mexico, Argentina, Peru and Venezuela, according to the 2024 World Digital Competitiveness Ranking published by the International Institute for Management Development (IMD).

The latest report marks the first time Puerto Rico has been included in the ranking.

Singapore topped the list, followed by Switzerland, Denmark, the U.S. and Sweden. At the bottom were Peru, Mongolia, Ghana, Nigeria and Venezuela.

For the 2024 ranking, the IMD’s World Competitiveness Center (WCC) analyzed 38 pieces of statistical data and 21 survey responses to measure digital competitiveness based on 59 criteria, including talent, regulatory framework, scientific concentration and IT integration. It then grouped results into three main factors or areas: knowledge, technology and future readiness.

Knowledge focused on the development and quality of human capital, education and research outcomes. Technology assessed if a country’s regulatory environment, financial investment framework and physical tech infrastructure support digital advancement. Future readiness evaluated how prepared economies are to adopt digital changes, emphasizing societal adaptability, business agility in adopting new technologies and IT integration across sectors.

Puerto Rico’s overall rank stemmed from its performance in these areas, ranking 52 in digital knowledge, 38 in technology and 44 in future readiness.The island benefits from a strong information and communications technology (ICT) infrastructure, despite the devastation caused by Hurricane Maria in 2017, Nearshore Americas recently reported in “Chile and Puerto Rico: LatAm’s Top Digitally Competitive Economies.”

Puerto Rico’s overall rank stemmed from its performance in these areas, ranking 52 in digital knowledge, 38 in technology and 44 in future readiness.

Puerto Rico’s strengths and weaknesses
The WCC identified the strengths and weaknesses that affected each country’s digital competitiveness rank.

Puerto Rico showed notable strength in “research and development personnel per capita” and “the number of women with degrees,” ranking No. 1 and No. 3, respectively, in these areas among the 67 economies analyzed. The island’s “management of cities” (61) and “R&D productivity by publication” (60) were its weaknesses. Well-managed cities typically have robust transportation networks and reliable utilities and provide a high quality of life for their residents, the IMD reported.

In technology, Puerto Rico was strongest in “high-tech exports (%)” (1), “investment in telecommunications” (2) and “mobile broadband subscribers” (4). The weak points were “immigration laws” (66) and “country credit rating” (65).

The WCC did not provide future readiness strengths and weaknesses for the island.

The positive results were not surprising given the high concentration of manufacturing in high-value, life-critical bioscience and aerospace products in Puerto Rico, while the negative results also were to be expected because of recovery funds not yet deployed after Hurricane Maria, Gail Nolan, CEO of the Puerto Rico 5G Zone, a local nonprofit dedicated to creating awareness and advocacy for intelligent infrastructure, told News is my Business. 

“Private investment after the hurricane has been exceptionally strong, and there are emerging technologies scheduled to be deployed in Puerto Rico that will uniquely elevate telecommunications, data transfer and storage abilities,” she said.

Nolan recently rewrote the textbook “Tech-Led Economic Development” for the International Economic Development Council, and she serves as president of the Puerto Rico Manufacturers Association Technology Committee and as infrastructure chairperson for the Puerto Rico Council for the Aerospace and Aeronautics Industry.

To increase its digital competitiveness, the island should decentralize resources into horizontal versus vertical hierarchical structures so that high performance manages the distribution of resources, Nolan explained. “This can be managed easily by new AI technology that looks at systems holistically.”

The remaining FEMA funds should be deployed to boost technology and telecommunications infrastructure and applications, and additional funding could advance the U.S. Economic Development Administration PRBio Tech Hub Designation, she said, noting that these efforts would require a cohesive strategy comprising public, private and nonprofit initiatives for economic growth.

A higher digital competitiveness rank would make Puerto Rico’s tech industry more attractive.

“For example, high-speed, low-latency communication network availability would allow Puerto Rico to not only have an Amazon distribution center [currently being built in Dorado] but also make it an ideal location for a fulfillment center to serve the entire Caribbean Basin. Additionally, it accelerates adoption of telemedicine, VR [virtual reality] training and service delivery, and financial industry transaction management,” Nolan said.

The Infrastructure Cluster of Puerto Rico (formerly the Puerto Rico Construction Industry Cluster) is working with the Puerto Rico Industrial Development Company to develop such a strategy, according to Nolan.

The digital divide
The World Digital Competitiveness Ranking tracks the continually changing conditions of digital governance, economy and society. It measures the capacity and readiness of economies to adopt and explore digital technologies for economic and social transformation.

The 2024 report, “The Digital Divide: Risks and Opportunities,” focuses on the global impact of the uneven development of digital infrastructure, geopolitical tensions and the effect of emerging technologies.

As technological advancements continue to evolve quickly, the ability of governments and companies to invest in data infrastructure and systems will be a greater determinant of a country’s digital competitiveness, the IMD reported.

The organization predicted challenges to digital competitiveness as a result of the recent U.S. presidential election results. “With Donald Trump having secured a second presidential term, we should be anticipating the effects of near-definite protectionism not only in the U.S. but also in Europe, China and the Global South,” said Arturo Bris, director of IMD World Competitiveness Center.

Countries resort to economic protectionism partly to safeguard strategic industries such as technology. “Geopolitical rivalries, particularly between major powers such as the U.S. and China, are fragmenting the digital landscape, influencing not only how other countries develop and use digital technologies but also their own ability to compete globally,” said José Caballero, WCC’s senior economist.

Author Details
Author Details
G. Torres is a freelance journalist, writer and editor. She’s worked in business journalism for more than 25 years, including posts as a reporter and copy editor at Caribbean Business, business editor at the San Juan Star and oil markets editor at S&P Global Platts (previously a McGraw Hill company). She’s also worked in marketing on and off for decades, now freelancing for local marketing and communications agencies.
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