BELARUS The ICT Sector in Belarus Opportunities and
BELARUS The ICT Sector in Belarus: Opportunities and Challenges Robert Kirchner, Deputy Team Leader German Economic Team Conference: Germany meets the Silicon Valley of Eastern Europe 7 th October 2020 © Berlin Economics
Growing importance of the ICT sector … Share of the ICT sector in GDP 8 % of GDP 6 4 2 0 2016 2017 2018 2019 8 M 2020 Source: Belstat Share of the ICT sector in employment 3 % of total employment 2 1 0 2015 Source: Belstat © Berlin Economics 2016 2017 2018 2019 • Share of ICT sector in GDP: 7. 6% (8 M 2020) • Positive long-term trend, further acceleration due to Covid-19 • Other sectors (8 M 2020): – Manufacturing: 21. 0% – Wholesale & retail trade: 9. 2% – Construction: 5. 8% – Agriculture: 5. 5% • Share in employment also growing, but smaller than GDP (higher productivity)
…driven by high export-orientation Exports of ICT services 3 000 • ICT services exports more than doubled over 2015 -2019 to USD 2. 4 bn • Share of ICT exports in total services exports was 25% in 2019 USD m 2 000 1 000 0 2015 2016 2017 2018 2019 Source: NBRB International comparison 500 Exports of computer services in USD per capita 400 300 200 100 0 DEU BLR USA UKR ARM Source: UNCTAD, World Bank; Data for 2019 © Berlin Economics IND JPN CHN RUS – Belarus traditionally exports transport services (roads, pipes) • Exports of computer services per capita at more than USD 220, more than double than in peer countries like Ukraine (94) and Russia (31)
The Hi-Tech Park: A success story so far Companies in HTP 1 000 Number of companies 800 600 400 200 0 2016 2017 2018 2019 7 M 2020 Source: Hi-Tech Park (HTP) HTP exports by countries Russia 5% Others 4% EU 49% USA 42% Source: Hi-Tech Park (HTP) © Berlin Economics • Liberal regulatory regime of HTP a key success factor for positive ICT development so far • HTP-based companies exported 91% of the country's total ICT services in 2019 • Relatively balanced major export markets (US, EU) • Going forward, major challenges – How will political situation impact future business and investment climate in the country, and the sector in particular? – Competition from other countries in the region, e. g. Ukraine? • At the same time: Covid-19 will accelerate long-term digitisation trends
About the German Economic Team The German Economic Team (GET) advises the governments of Ukraine, Belarus, Moldova, Georgia and Uzbekistan regarding the design of economic policy reform processes and a sustainable development of the economic framework. As part of the project we also work in other countries on selected topics. In a continuous dialogue with high-level decision makers of the project countries, we identify current problems in economic policy and then provide concrete policy recommendations based on independent analysis. In addition, GET supports German institutions in the political, administrative and business sectors with its know-how and detailed knowledge of the region’s economies. The German Economic Team is financed by the Federal Ministry of Economic Affairs and Energy. The consulting firm Berlin Economics has been commissioned with the implementation of the project. CONTACT German Economic Team Tel: +49 30 / 20 61 34 64 0 c/o BE Berlin Economics Gmb. H info@german-economic-team. com Schillerstraße 59 www. german-economic-team. com 10627 Berlin © Berlin Economics
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