Central America is at a critical juncture on its path to digitalization, where the adoption of 5G plays a fundamental role. According to the “5G Americas Usage” report, the Latin American and Caribbean region is expected to have 127 million 5G connections by the end of 2024, potentially reaching 501 million four years later. This advancement not only entails improved connectivity but also opens the door to a series of opportunities that could transform the regional economy.
This deployment will enable the integration of advanced technologies such as big data, artificial intelligence (AI), and the Internet of Things (IoT), laying the groundwork for increased productivity, rising demand for technological products and services, as well as the acceleration of other industries and the attraction of foreign direct investment (FDI). However, for this to happen, the region will require critical digital infrastructure to facilitate the adoption of 5G.
To achieve this, Central American countries must work on agendas to bridge the digital divide and remain competitive with the rest of the world. On average, 84% of the population in OECD countries uses the internet, while in Central America, specifically Panama and the Dominican Republic (CAPARD), the figure stands at 47%. This disparity potentially indicates challenges and unaddressed issues, particularly regarding infrastructure and broadband deficits, as highlighted in a 2020 report from the Inter-American Development Bank (IDB).
For mobile 5G networks to advance swiftly and effectively, vertical markets will need to invest in critical infrastructures, such as cooling systems to dissipate heat for continuous operation, technologies for remote monitoring and management of 5G, and power technologies that optimize energy use while minimizing environmental impact.
The Potential Economic Impact of 5G in Latin America
While 5G will enable the connection of up to one million devices per square kilometer, an advanced digital environment also enhances the creation and acceleration of tech companies and startups to develop and test new applications and services, driving job opportunities for Central American talent.
- Healthcare, particularly in telemedicine and access to advanced medical services.
- Education, where students, teachers, and other stakeholders can access digital educational resources and expand remote learning.
- Agriculture, through the implementation of IoT technology to improve efficiency and productivity.
- Industry, thanks to the automation and digitalization of industrial processes.
- Tourism, as it will facilitate and enhance experiences through the development of digital applications and services.
In the initial phases of 5G deployment, much of the development will focus on critical infrastructures, necessitating updates to existing infrastructure and investment in new hardware to support the anticipated demand increase.
Addressing infrastructure and broadband challenges will accelerate the rollout of 5G, propelling Central America toward the digitalization it needs. This will enable tools that can enhance the region’s capacity to create a productive environment that fosters livelihoods, provides greater opportunities for foreign investments, and stimulates the economy. Companies that are prepared for early adoption will be well-positioned to benefit from the myriad opportunities presented by digital transformation.
Source: Forbes Centroamérica
