The multi-billion-dollar gaming industry continues its relentless growth, even after a pandemic-related boom. Today, there are 2.7 billion players around the world, over one third of the global population, and by the end of 2026, the industry is forecast to be worth USD 321 billion, according to a PwC report. By the end of 2023, there will be 400 million new gamers in the global community.
Latin America, with 289 million gamers accounts for 10% of the global industry. These figures have contributed to the emergence of many new game development companies. According to Statista, the game development industry in Mexico alone generated an annual turnover of USD 1.9 billion. Brazil and Argentina complete the top-three rank in the region with USD 1.7 billion and USD 0.5 billion, respectively.
Argentina is a particularly interesting one to watch, according to the co-founder of a game development company, “Despite a tough macroeconomic environment, the Latin American gaming industry is forecast to grow by 20% this year, well above the growth rate of the wider economy. The reasons for this growth are diverse: a significant increase in worldwide demand, industry support from the government and high-quality professionals delivering great products.”
“Despite a tough macroeconomic environment, the Latin American gaming industry is forecast to grow by 20% this year, well above the growth rate of the wider economy.”
Co-founder, game development company, Argentina
While the game development industry in Argentina is still small, it still offers an important source of income and foreign reserves for the country, claims an economic analyst in Buenos Aires, “In the context of the whole Argentinian economy, gaming is still a very small sector, although it is very interesting because it is clearly an exporter: almost 80% of what is produced is for abroad, and for Argentina anything that brings foreign exchange is most welcome.”
In Chile, the industry is steadily growing too. With the support of ProChile, the government’s export promotion agency, six local companies participated in the 2022 Game Developers Conference in San Francisco, US, considered the industry’s most important event. In July 2022, ‘The Eternal Cylinder’, an alien adventure videogame produced by Chile’s ACE Studios received the Best Latin American game award at the BIG Festival.
The industry’s growth prospects seem exciting but what further support do businesses need to capitalise on the opportunity? A large shareholder in a Mexican game development company submitted his wishlist, “The sector needs greater levels of external financing; a lower tax burden; better internet and mobile infrastructure, as well as the formation and training of more employees linked to the industry. I can already see a talent bottleneck forming, which will ultimately impact the growth of the sector.”
“The sector needs greater levels of external financing; a lower tax burden; better internet and mobile infrastructure, as well as the formation and training of more employees linked to the industry.”
Shareholder, game development company, Mexico
We asked an industry entrepreneur the same question and received a similar answer, “Latin America’s gaming industry desperately needs economic stability, access to capital, lower tax pressure, better education of talent and many among other things.”
Skilled professionals and the collaboration of world-leading creative artists have given Latin American game developers a reputation for high-quality products. The region’s language barrier has boosted the number of domestic game development hubs in Mexico and Brazil which attract talent from all over the continent.
With growing demand being met by higher-quality supply and improving infrastructure, it’s far from “Game Over” for the Latin American gaming industry.