This week,

  1. The Eurasian Economic Union is going digital;
  2. New details on 4G introduction in Ukraine;
  3. Experts analyzed the Russian Internet policy;
  4. Uzbekistan continues its digitalization;
  5. Financial sector updates in Eurasia;
  6. Biometric passports in Uzbekistan.

1. Towards Digital Eurasia.

Digital Economy | Armenia | Belarus | Kazakhstan | Kyrgyzstan | Russia 

The issue of digital integration of the economies of the EAEU member states was the central topic at the meeting of the Eurasian Intergovernmental Council in Astana, Kazakhstan on August 14, 2017. The Prime-ministers of Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia discussed the project of Eurasian Digital Agenda 2025. The main goal is to offer the common digital development strategy that is synchronized with their national programs, including “Digital Kazakhstan”, “Digital Economy” of the Russian Federation, “Taza Koom” in Kyrgyzstan, and the developing concepts in Armenia and Belarus.

According to Tigran Sargsyan, the Head of the Eurasian Economic Commission (ECE), the member states should harmonize their digital policies. There are ten different initiatives offered for digital transformation of the Eurasian Union. Among them the digitization of common markets, digitization of the infrastructures, digital security, the transformation of the management systems, digital industry transformation, e-commerce, and public procurement. Sargsyan stated some of these initiatives will turn into pilot projects in 2018 and 2019.

DR Comments: Recently we published a brief summary of the key developments in the region related to national digitalization programs. The trend is clear and so is the emerging window of opportunity for investors and developers of digital products and solutions. DR Analytica’s experts not only highlight and monitor the developments of digital programs in Eurasia but are actively involved in many of them. Contact us if you wish to discuss your options in Eurasia.

2. 4G in Ukraine: To Be or Not to Be?

Digital Access | Ukraine

The question of the introduction of 4G in Ukraine remains open. The Cabinet has ratified a new decision on the amount of payment for the issuance of 4G-licenses in the 1800 MHz band. The cost will be about USD $37,800 for 1 MHz in a single region with a license validity period of 15 years. The Ukrainian National Commission of Communication and Information (UNCCI) is preparing a new tender to introduce 4G in the country. 4G will allow Ukraine to develop the digital economy and to introduce many medical, educational, financial and e-governance services. The expected state budget revenue from the 4G introduction is estimated at USD $150 million.

DR Comments: Earlier we informed that the previous tender process was organized against the current regulation since UNCCI gave preferences to some mobile operators. Ukraine is going to be among the last European countries to introduce 4G. 3G was introduced only in 2015.

3. How Efficient Is the Russian ICT Policy?

Information Security | Russia

The goals of the Russian ICT policy are clear. The government is looking after a total control over ICT to ensure the national information security. In addition to the extremely controversial Yarovaya Law adopted in 2016, the government adopted laws banning the use of VPN servers, anonymizers, and anonymity in the Instant Messengers. Both Russian and International experts criticize such policies. The analysis of the experts’ opinion shows that state officials do not understand that it is technologically impossible to control everything.

The only way to control the Internet is the Chinese approach of the establishment of the closed national Internet that does not allow to surf the global web, however, even this approach is not completely efficient. The government is able to spend significant funds to implement inefficient policies which are justified by “children protection” (as in the case of the National Internet Traffic Filtering System) or anti-terrorism (The Yarovaya Law). On the other hand, the inefficiency of such policies may indicate the corruption behind those political decisions. The implementation of the above-mentioned policies requires specific hardware and software; therefore, developers of those solutions can request the development of such regulations and programs in order to earn money and at the same time to share it with those who promoted the adoption of those policies.

DR Comments: It is impossible to control the Internet; however, the government is interested in controlling people. The Ministry of Communications has determined what personal data of Internet users will be provided upon the request of Law Enforcement by ICT providers: name, the online nickname of the user, date of birth, passport data, address, IP, phone number, the list of relatives, user ID, the date and time of registration. The Providers will also give them access to the users’ private messages, transmitted files, audio and video records, and e-payments data.

4. A Snapshot of the Digitalization of Uzbekistan.

E-Governance | Uzbekistan

Aziz Abdukhakimov, the Minister of Employment and Labor Relations, told DR about the new IT projects of the ministry, and about the problems that automation allows to solve. The ministry is now going paperless – electronic document management has optimized the times and sources required to proceed the tasks, and most importantly, the Ministry automated the accounting and processing of the entire flow of information. The automation of processes also reduced the influence of the human factor. One of the major IT projects of the Ministry is the national database of vacancies Assistance in employment is one of the main functions of the Ministry and the Employment Promotion Centers. The new platform allows receiving reports on the availability of vacancies from employers in the paperless form using an electronic digital signature (EDS).

At the same time, Sherzod Habibullayev, the Director of the Uzbek E-Government Development Center, informed about the results of implementation of key projects in 2016 and further Center’s plans in the interview to DR. Among them, he mentioned the modernization of the real estate registration system; the creation of a single database, which already holds information on 15.5 million citizens; and many other projects in the spheres of education, accounting, notary services, etc. In the near future, an updated version of the Unified Portal for Interactive Public Services will be launched.

DR Comments: Since the last year, the development of the ICTs has significantly increased in Uzbekistan. It seems that the investment climate shows positive changes and promise new opportunities to the businesses. Contact DR Analytica to assess your opportunities in Uzbekistan.

5. Financial Eurasia: E-Signature, Blockchain, Cryptocurrency, & Cashless Payments.

Digital Economy | Russia | Armenia | Ukraine | Azerbaijan | Uzbekistan

The Press Service of the Russian National Payment Card System reported that the process of integration of the national payment systems Mir (Russia) and ArCa (Armenia) has been successfully completed. This integration is a result of bilateral agreement on cooperation that was signed in June 2016.

The National Bank of Ukraine authorized the use of e-signature in the document circulation of the country’s banking system. The new regulation specifies the terms of use of e-signatures, its types, requirements for the application, as well as requirements for the creation and storage of e-documents in the national banking system.

According to Ilkin Veliyev, Deputy Minister for Taxes of Azerbaijan, as a result of the law “On Cashless Payments“, the cash turnover in the sphere of issuing wages and other payments decreased by 75.3%, while the share of e-payments significantly increased. The application of this law led to an increase of the transparency of expenditures, legalization of incomes, and a reduction of tax evasion and increased transparency in the tax sphere.

The Financial Markets Department of the Russian Federal Antimonopoly Service (FAS) is discussing how to apply regulation to crypto-currencies. The Bank of Russia is preparing a bill that will consider cryptocurrencies as digital commodities. Meanwhile, the Federal Agency on Technical Regulation and Metrology (Rosstandart) is developing national standards of the blockchain technology application. The main goal of this initiative is to raise the development of technologies, encouraging of its closer interaction, public adoption, methods of application, and increasing confidence in the blockchain. At the same time, beginning 2018, the Bank of Russia requires financial organizations to submit a mandatory monthly report on incidents involving theft of money from customers’ accounts. The innovation is aimed at increasing the information security and cyberattacks prevention in the banking sector.

The first ATMs of the newly established Uzcard payment system were installed in Tashkent. ATMs accept plastic cards of any bank connected to the new system.

6. Uzbekistan to Progress the Spread of Biometric Passports.

E-Governance | Uzbekistan

Beginning January 1, 2019, the citizens will use biometric passports to travel abroad. The government plans to approve the State Standard for the Biometric Passport by December 1, 2017, and submit the new regulation for approval of the Parliament by January 1, 2018. Uzbekistan launched the issuance of biometric passports in 2011. In June 2017, the Ministry of Interior reported that 80% of the population received biometric passports.

This digest is also available in Russian