Export Strategy for Information Technologies Sector
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MINISTRY FOR DEVELOPMENT OF ECONOMY, TRADE AND AGRICULTURE OF UKRAINE STUDY EXPORT STRATEGY FOR INFORMATION TECHNOLOGIES SECTOR 2019–2023 CONTENTS Acknowledgements .......................................................................................... 1 List of figures .................................................................................................. 3 List of tables ................................................................................................... 3 List of boxes ................................................................................................... 3 Executive summary ............................................................................................ 4 Definitions used in this document .................................................................... 6 International context: Constantly growing industry with an impact on the overall economy ................................................................................................. 10 The evolving global digital economy and IT services exports increase ..... 10 Key technologies transforming global economy ...................................... 13 The four key growth factors of the technology sector within a country ..... 16 National context: the level of IT industry development in Ukraine .............. 18 Typology of IT companies ............................................................................ 22 Technology Service Companies ............................................................. 22 Product Companies ................................................................................. 24 Captive Centers ........................................................................................ 25 Technology Startups ................................................................................ 25 Supporting Infrastructure ........................................................................ 26 Positions of key technologies transforming global economy in Ukraine ... 27 Sector diagnostics ............................................................................................. 31 Focusing on the most pressing issues ........................................................ 33 Regulation and legal issues ..................................................................... 34 Linkages with buyers ................................................................................ 35 Linkages with suppliers ........................................................................... 36 Linkages with institutions ........................................................................ 36 Skills requirements ................................................................................... 37 Innovation requirements and infrastructure .......................................... 38 Financing requirements .......................................................................... 38 The way forward ................................................................................................. 39 Vision .............................................................................................................. 39 Strategic orientations .................................................................................... 39 Technological priorities for Ukraine ....................................................... 39 Market priorities for Ukraine ................................................................... 41 The strategic framework .................................................................................... 44 Institutional adjustments .............................................................................. 45 Regulatory amendments .............................................................................. 47 Initiatives for practical implementation of strategy in the ecosystem ...... 51 Functions of Program Office: .................................................................. 51 Team Structure of Program Office: ......................................................... 51 Plan of Action 2019–2023 ................................................................................. 54 References .......................................................................................................... 80 Appendix 1: List of participants in the public–private consultations (in alphabetical order) ....................................................................................... 81 Appendix 2: Additional information on IT companies in Ukraine ................ 86 Appendix 3: Additional information on Artificial Intelligence Opportunities .................................................................................................... 87 ACKNOWLEDGEMENTS This Export Strategy for Information Technoligies Sector 2019–2023 was initiated by the Ministry of Economic Development, Trade and Agriculture of Ukraine in the framework of «Export Strategy of Ukraine: Strategic Trade Development Roadmap for 2017–2021 and Action Plan» implementation, elaborated with the support of the International Trade Centre and Non–Governmental Union «Foundation for Support of Reforms in Ukraine» and with financial contribution from the German government through Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. The document benefited particularly from the inputs and guidance provided by the members of the Information Technology (IT) sector core team who steered the formulation of the Strategy. The views expressed herein may not reflect the views of the German federal company Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Non– Governmental Union «Foundation for Support of Reforms in Ukraine» and the Ministry of Economic Development, Trade and Agriculture of Ukraine, or individual experts and might also not reflect the official opinion of any of the organizations whose members presented their support for strategy design. Name Position Organization Aleksandra CEO/Founder, Honorary Member Data Science UA, Kyiv IT Sirovatko Cluster Alexandre Director Association of Enterprises Yurchak of Industrial Automation of Ukraine (APPAU) Antoniuk Doctor of Sciences, Professor, Kyiv National Economic Larysa Vice–Rector for Research University named after Vadym Hetman, Ukraine Deborah Senior Adviser to the Ukrainian Minister Ministry of Finance Fairlamb of Finance / Government Commissioner for Investments Dmitry Acting Director IT Ukraine Association Ovcharenko Ievgeniia Director IT Committee EBA Luganovska Ihor Expert, IT & Telecom Sector Better Regulation Delivery Samokhodsky Office Iurii President APITU Perohanych Iurii Head of the Board AgTech Ukraine Association Petruk Ivanna Project Coordinator Kharkiv IT Cluster Pogrebniak Jane CEO 1991 Open Data Incubator Klepa Konstantin Vice Head of the Office National Investment Council Chyzhyk Maria Vice Head State Institution “Export Shevchuk Promotion Office” Marina Supervisory Board Member BrainBasket Foundation Vyshegorodskikh Maryana Adviser to the Minister Ministry for Development Kahanyak of Economy, Trade and Agriculture of Ukraine Mihail Chairman Clust–UA Agency Krikunov 1 Natalia CEO Blockchain Association Drik Nataly CEO, National Coordinator of Export Kyiv IT Cluster Veremeeva Strategy for IT Sector Olesya Adviser to the Minister Ministry of Economic Zaluska Development and Trade of Ukraine Olga CEO Ukrainian Venture Capital Afanasyeva and Private Equity Association (UVCA) Ruben Chair International Advisory Board Amsterdam Economic Nieuwenhuis Board Sofia CEO Kharkiv IT Cluster Belenkova Vitaliy Head of expert group of Directorate of Innovations Chernuik communications and strategic planning and technology Transfer, MESU Yegor Head NGO Innovative Nation Chernev The positions stated are actual as of the period that these stakeholders provided their input. The full list of public and private stakeholders who contributed to the design of this Strategy is detailed in Appendix 1. 2 LIST OF FIGURES Figure 1. The architecture of the digital economy ......................................... 10 Figure 2. World exports of other commercial services by main category, 2016 ..................................................................................................................... 12 Figure 3. Exported value of global telecommunications, computer, and information services, 2006–2017 (US$ billion) ................................................ 12 Figure 4. Regional distribution of IT spending ............................................... 12 Figure 5. Four key factors for creation of enabling business ecosystem for IT sector development ................................................................................. 16 Figure 6. Ukraine ICT services export, thousand US$ .................................... 19 Figure 7. Top importers of Ukrainian ICT services .......................................... 20 Figure 8. Typology of ICT companies in Ukraine ............................................ 22 Figure 9. Structure of Ukrainian ICT, US$ bln. ................................................ 24 Figure 10. IT consumption structure in Ukraine, % ........................................ 24 Figure 11. Mapping of start–ups in Eastern Europe ....................................... 25 Figure 12. Business ecosystem of IT industry in Ukraine ............................... 32 Figure 13. ITC framework for SME competitiveness ...................................... 33 LIST OF TABLES Table 1. Worldwide IT Spending Forecast (US$ billion)