Digitalization of National Economies and E-Governance – a Regional Trend in Eurasia

This bulletin summarizes key developments in the region related to national digitalization programs, efforts, and challenges to provide analysts and decision-makers with an actionable intelligence. DR Analytica is directly engaged in these activities on the ground and could provide additional information on request.   

Moldova

Moldova has reached about 60%-70% of the goals established by the national strategy “Digital Moldova 2020”, stated Vitalie Tarlev, Vice-Minister of IT and Communications of Moldova in the interview to DR. According to Tarlev, the most important success of the program is achieving the highest Internet penetration rate in the region – about 75% of population, with 3G coverage extending to 98-99% of the country and 4G available to 85% of the population. The recently created Public Service Agency will be responsible for ensuring the optimization and digitization of most public services. The government is also adopting ICT regulations benefiting the IT industry, such as amendments to the Tax Code and other laws. For instance, residents of IT parks in Moldova will enjoy a unique, single tax rate allowing start-ups to grow. At the national level, Moldova introduced the minimum mandatory cybersecurity requirements for state institutions to increase the national security – a potential opportunity for companies specializing in IT/cybersecurity solutions to present their products and services.

Belarus

A working group led by Vasily Matyushevsky, the Deputy Prime Minister, is working on a comprehensive package of ICT legislation (to be submitted by January 1, 2018) to establish a legal framework for digitalizing the Belarusian economy and governance.

According to the Ministry of Communications and Informatization, e-government is seen primarily as an approach to modernizing and optimizing the state management processes, stated Anna Ryabova, Deputy Minister of Communications in the interview to DR. Belarus has already established the National Center for Electronic Services to provide government services electronically. In 2018, Belarus will adopt the new ICT regulation on collection and storage of personal data, managing financial e-projects, and security and accessibility of public services. According to the Deputy Minister, the government is also looking to use blockchain technology and Big Data.

In another setting, the Deputy Minister of Health, Vyacheslav Shilo, informed DR about the introduction of e-Health services across the country. The digitization of healthcare in the capital-city Minsk already reached 85%, while in some regions it lags behind at 45-50%. The e-document circulation in medical institutions will continue to increase as the government, supported by a World Bank program, stimulates the introduction of patients’ digital profiles, e-prescriptions, and various telemedicine projects.

Armenia

The Prime Minister of Armenia, Karen Karapetyan, outlined the main directions for ICT sector development and digitalization of the country. The priority will be given to 1) improving the IT education, 2) increasing competitiveness, efficiency, and productivity of the industry, 3) creating clear mechanisms for stimulation of business-driven innovations. The national digitalization program will be announced shortly, as well as the “Concept of Cybersecurity of Armenia”, developed with support from DR Analytica experts.

Ukraine

Alexander Danchenko, Chairman of the Verkhovna Rada Committee on Information and Communication, announced the need to create a Ministry of Digital Economy to stimulate the introduction of ICTs at the state level. The new ministry would also help to get rid of corruption, which according to him remains one of the biggest Ukrainian problems.

Russia

According to McKinsey’s report “Digital Russia: New Reality”, the volume of Russia’s digital economy is growing 9 times faster than the country’s GDP increasing by 59% from 2011 to 2015. However, the report pointed to one peculiarity: while the digital expenditures of households in countries with higher levels of ICTs adoption make 3.6% of GDP, in Russia this rate is 2.6%. The Russian “Digital Economy” program was approved by President Putin on July 5, while the Action Plan for the program’s implementation is still being developed. According to open source information, Russia plans to spend USD $1,7 billion a year until 2025 to implement the program.

DR Comments: Previously we highlighted the launch of various digitalization programs in Kyrgyzstan (Taza Koom) and Kazakhstan (Cybershield of Kazakhstan).

Summary

Digitization and digitalization processes are unfolding throughout the Eurasian region. Considering the state of many of these national programs, the trend is clear and so is the emerging window of opportunity for investors and developers of digital products and solutions. The most rapid developments occur in the financial and banking, transportation, e-government, and e-health sectors, making the need for trusted solutions in these areas most acute. All those who consider entering Eurasian markets should note, however, that despite the ongoing efforts to harmonize national ICT regulations with international standards, every country in the region has its own approaches to information security, digital economy, or e-governance. Therefore every case requires knowledge and understanding of the national ICT market.

DR Analytica experts not only highlight and monitor all digital developments in Eurasia but are actively involved in many of those processes. Contact us if you wish to discuss your options in Eurasia.