Transcript ICT Industry Development in Armenia

Armenian ICT Industry overview and the role
of the Union of Information Technology
Enterprises in promotion of ICT/High Tech
Development in Armenia
ICT Industry Overview
Before 1991 Armenia was regarded as a Silicon Valley of
the former Soviet Union.
The main industry sectors were:
• Mechanical engineering
• Electronics
• Chemical industry
• Energy industry
• Light Industry
Armenian industry inherited:
• High quality technical workforce (according to the Brainbench
Global Skills IQ Report for 2006, Armenia was ranked second in the
world, after USA, in the number of IT certifications received per
capita)
• Physical infrastructure (airways, roads, railways and telecom)
• Generally adequate manufacturing facilities coupled with scientific
and design institutions
ICT Industry Overview
Today ICT industry is one of the most dynamic and
promising sectors of the economy
2008
• The share of the
sector in Armenia's
$9.2 billion
nominal GDP - 1.2%
• 175 ICT companies
(56 foreign)
• About $111 mln in
total revenue ($10
mln in 1998)
ICT Industry Overview
Major specializations include:
•Embedded
systems
•Semiconductor
design
•Custom software development
• Financial applications
• Security and encryption
• Software development and
outsourcing
•Multimedia
design
•Industrial
automation
•Web design and
development
•Educational software
• Management information
systems
• Computer aided design
• Systems integration
ICT Industry Overview
Geographical Distribution
• Share of local companies’ revenues in the industry’s total amounts to 38% ($42
million)
• Average revenue per company for locals - 30% ( 3% - branches)
• At the peak in 2004, annual number of start-up ICT firms reached 25-30 (26%
growth per year)
• In 2008 total number of ICT companies established with foreign investment reached
56 (32% from the industry total)
RA Government ICT industry Development Strategy
Armenian Networked Readiness Index (NRI) 2008–2009 – 114
Azerbaijan (60), Russia (74), Georgia (88), Moldova (99),
Turkey (61), Colombia (64), Kenya (97) and Nigeria (90)
Variables
Armenia
Azerbaijan
Georgia
52
64
57
119
20
89
126
88
98
91
81
82
127
34
76
Internet users (hard data)
105
85
96
Company spending on R&D
96
67
121
Total tax rate (hard data)
Government success in ICT
promotion
Mobile telephone subscribers (hard
data)
E-government readiness index
(hard data)
ICT use and government efficiency
RA Government ICT industry Development Strategy
New ICT sector development concept (2008)
Key milestones:
Short-term (1-3 years):
Build world class ICT infrastructure to support Armenian ICT
industry and information society development
Mid-term (3-5 years):
Strengthen Armenia’s ICT infrastructure and ensure the
presence and penetration of “Armenia ICT brand” in the global
market
Long-term (5-10 years):
Achieve full “Armenia ICT brand” penetration in global markets
and particularly in targeted high-growth market segments.
Contribute to the growth of ICT, increase in sector revenues and
development of knowledge-based economy through ICT
infrastructure and Information Society development.
RA Government ICT industry Development Strategy
Information society and IT Industry growth target indicators:
Key Data
Home computer penetration
Educational computer penetration
Public sector computer penetration
Consumption of local IT products in the
internal market – GDP
Share of e-services provided by RA state
entities against the total
Number of IT companies
From which those with foreign capital
committed
Workforce
Industry revenues
IT R&D companies
Large technology cities
Techno-Parks & incubators
2006
5%
10%
10%
0.5%
2018
50-70%
80-90%
100%
2-4%
<1%
80%
160
50
1000
200
5000
84 million
(USD)
<10
0
2
20000
1 billion
(USD)
100-200
1
>10
IT D E V E L O P M E N T
ACTION PLAN
2008-2018
Design, develop and
build world class ICT
infrastructure serving
major regions, cities,
government & private
industry
2008-2018
Develop & launch
2008-2013
targeted programs
Equip and operate
aimed at increasing
national Tele-Centers
Armenia IT graduates
serving citizens in key
and workforce.
Armenian regions &
towns.
2008-2011
Build Armenian Techno-Park
supported by world class ICT,
municipal infrastructure and
services
2008-2011
Select, develop and rollout
E-Government pilot projects
(Rollout (3) pilot projects in 3
years)
IT D E V E L O P M E N T
ACTION PLAN
2008-2013
Establish Armenian Software
Engineering Competence Center to
certify & train Armenian software
developers to ensure compliance with
global Capability Maturity Model
Integrated standards
2008-2015
Replicate EIF business
incubator model and
establish university-based
technology transfer centers
(TTC) to stimulate IT
innovation & product
development
2008-2018
Develop , design & rollout
world class strategic
marketing & promotional
campaign to position
“Armenia brand” in targeted
high growth IT markets.
2008-2018
Establish Armenian IT Enterprise
Development Fund to promote
private IT companies; attract
foreign direct investment &
venture capital to develop and
commercialize IT innovation &
product development
The Union of Information Technology Enterprises
Main Strategic Directions (2010):
Education and workforce development
(strategic goal: the number of qualified ICT specialists is 10000)
Legal framework/collaboration with state bodies
(strategic goal: ICT is a priority industry in Armenia in practice)
Development of ICT/High Tech sphere/Formation of Information
Society
(strategic goal: higher level of use of ICT in other businesses)
Development and enhancement of the association
(strategic goal: UITE is an influential and powerful institutional
organization serving the interests of its member enterprises)
The Union of Information Technology Enterprises
UITE in brief
• Participation in CeBIT (2000-2009)
• Intellectual Property Rights Protection Campaign
• Custom legislation improvement project
• Tax legislation improvement project
• Membership Development Initiative
• Development of ICT/High Tech Portal (www.uite.org)
• DigiTec Expo 2005-2008 ICT/High Tech exhibition
(www.digitec.am)
• ICT Industry Leaders and Stakeholders Meetings
• UITE is the official counterpart of CBI, the Netherlands’ Centre for
the Promotion of Imports from developing countries
• Active participation in the development of state concepts, relating to
ICT/High Tech field and Business Environment Legislation.
•ICT/High Tech Educational Consortium
The Union of Information Technology Enterprises
2009 Action Plan
Education and workforce development
• ICT/High Tech Consortium Establishment
• Develop and provide special leadership development,
effective financial management, startup business essentials
and promotion modules trainings to beneficiaries
• Promotion of startup business support programs in the
regions of Armenia
• (Armenia)
• Legal framework/collaboration with state bodies
• Promotion of tax & custom legislation improvements
• Media campaign
Development of ICT/High Tech Industry/ Promoting
Regional Cooperation
–
–
–
–
–
–
–
–
Develop Armenian High Tech Virtual Community Portal
Assist Government in Techno City establishment in Gyumri
Organize DigiTec 2009 / DigiTec Business Forum
Organize Armenian Open Robotics
Contests(robotics.digitec.am)
Promote regional cooperation initiatives of UITE member
companies
Develop and organize regional study tours for the
representatives of leading Armenian ICT/High Tech
companies and vice versa
Co-organize Armtech 2009 Congress
Organizing the series of ICT Leaders Meetings
The Union of Information Technology Enterprises
The main problems that hinder Armenian ICT industry
development
The lack of authorized state body responsible for Information
Society development
Limited financing for ICT sector
Insufficient interaction among the entire scope of the sector’s
infrastructure,
including
the
Science,
education,
telecommunication, state ministries and the private sector
Low level of government investments in R&D
Excessive Custom and Tax administration (applications of
“estimated prices” custom clearance method for ICT goods for
importing and VAT levy at the border for importing)
The lack of tax benefits for educational investments
The lack of qualified ICT specialists
THANK YOU