South America's Intangible Economy: Brazil and the Region Face a Knowledge-Investment Reckoning

When economists talk about the commanding heights of a modern economy, they increasingly mean something invisible. Software. Brand equity. Proprietary data. Organisational know-how. Research pipelines. These are the assets driving investment globally, and for the first time the combined weight of such spending has crossed a threshold that once seemed abstract: USD 10 trillion in a single year.

New figures released by the World Intellectual Property Organization (WIPO) and Italy's Luiss Business School (LBS) place that milestone in 2025, the result of intangible investment growing at 5.5 percent annually between 2020 and 2025 — nearly twice the 3.2 percent annual growth rate recorded for tangible investment over the same period. Across the 29 high- and middle-income economies covered by the report, intangible investment now accounts for nearly 13 percent of GDP, a share the report describes as a durable structural shift rather than a cyclical blip.

For South America, the findings carry specific weight. Brazil appears explicitly in the data, ranking among the world's largest intangible investors with USD 312 billion invested in 2023. That figure places the country in elite company on a global ranking that otherwise reads like a roster of the world's most technologically advanced economies. Yet the number also raises harder questions: whether Brazil's intangible investment is translating into the kind of productivity gains and export competitiveness that similar spending generates elsewhere, and whether other South American economies are building comparable capabilities at all.

A Gap That Keeps Widening

The WIPO-LBS report is unsparing about the concentration of intangible investment. Companies and government entities in the United States invested nearly USD 5 trillion in intangibles in 2025 alone — by far the most of any economy studied. The gap between the US and the next four economies combined has roughly doubled over the past decade, from about USD 1 trillion in 2015 to USD 2 trillion in 2025.

Japan placed second globally with USD 810 billion invested in intangibles, ahead of Germany at USD 695 billion. In emerging economies beyond South America, India recorded intangible investment growth of 5.3 percent annually over the past decade, and the Philippines — appearing for the first time in the dataset — posted 3.9 percent annual growth over the same period, both figures exceeding the pace recorded in several high-income economies.

Brazil's USD 312 billion figure, while substantial in absolute terms, is striking for the fact that no other South American country appears in the dataset, leaving policymakers across the Andes, the Southern Cone, and the Río de la Plata basin without a comparable baseline from which to gauge their own positioning.

The AI Accelerant

The WIPO-LBS report identifies artificial intelligence as the force reshaping the investment landscape through two distinct waves. The first is physical: data centres, semiconductors, power infrastructure, and the networks required to run advanced AI models. This wave has proved stronger than expected and is helping to revive tangible investment, though it remains geographically concentrated — most visibly in the United States.

The second wave is where the deeper economic story lies. As firms worldwide invest in data, software, research and development, brands, organisational capital, and workforce training to deploy AI meaningfully, intangible investment accelerates further. The report's assessment is clear: as with previous general-purpose technologies, AI's lasting economic impact will come less from the physical infrastructure wave than from the intangible assets built on top of it.

For South American economies, both waves present structural challenges. The physical AI infrastructure wave demands capital, reliable energy grids, and semiconductor supply chains — areas where the region has historically faced constraints. The intangible wave demands the capacity to build education systems, legal frameworks, and regulatory environments suited to knowledge-intensive production.

The Measurement Problem

A further complication acknowledged by the report is that much intangible investment goes unrecorded in official statistics. Organisational capital, brand development, and workforce training in particular remain largely invisible in national accounts frameworks. The WIPO-LBS database attempts to address this by tracking investment across all intangible asset classes, including those outside official statistics, following the national accounts framework proposed by Corrado, Hulten and Sichel.

This measurement gap matters enormously for South America. If advanced economies are already underestimating their own intangible investment, the undercount in economies with less developed statistical infrastructure is almost certainly larger. Policymakers cannot allocate resources toward an economy they cannot see clearly, and businesses cannot benchmark performance against competitors whose true investment profiles remain obscured.

Policy Frameworks Under Pressure

The structural shift documented by WIPO reflects a fundamental reordering of competitive advantage. The region's traditional comparative advantages — natural resources, agricultural commodities, manufacturing labour costs — do not automatically translate into competitiveness in an economy where the scarce inputs are proprietary algorithms, curated datasets, and accumulated organisational knowledge.

Brazil has the scale to build those capabilities; whether its universities, technology clusters, and corporate investment patterns are aligned to do so at the pace the global shift demands remains an open question. For smaller South American economies, the challenge is more acute: how to specialise within the intangible economy in ways that generate sustainable growth rather than deepening dependence on knowledge produced elsewhere.

The USD 10 trillion threshold is a useful marker, but what it signals for this region is less a milestone to celebrate than a benchmark against which to measure an urgent and still-unfinished adaptation.

Remaining Questions

Aspects not covered by available verified sources

• Intangible investment data for any South American economy other than Brazil — including Argentina, Colombia, Chile, Peru, and Venezuela — are not available in the WIPO-LBS dataset as currently published.
• How Brazil's USD 312 billion in intangible investment breaks down by asset class (software, R&D, brands, organisational capital, etc.) is not specified in the source material.
• Whether Brazil's intangible investment growth rate over the 2020–2025 period matches, exceeds, or lags the global 5.5 percent annual average is not stated in the source.
• The specific policy responses — if any — adopted by South American governments in direct response to the WIPO-LBS findings remain unverified.
• The degree to which South American firms versus government entities account for the region's intangible investment is not broken out in the available data.
• How the AI infrastructure wave is specifically affecting energy and semiconductor supply conditions in South America falls outside the scope of the source material.

Several verified sources, together with artificial intelligence, were used in the preparation of this article. The content was reviewed by our editorial team prior to publication. Disclosure provided in accordance with Article 50 of the EU Artificial Intelligence Act (AI Act).