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Romanian Experiences Related to ICT - R&D

Prof. Vasile Baltac President ATIC
1st IT STAR Workshop on Enabling ICT R&D Bratislava, 11 November 2006

ROMANIA: Economy
• EU accession date 1 January 2007 • The GDP per capita
– rather small • 4.411 USD in 2005 •
at exchange rate parity 8.400 USD in PPP (purchase power parity)

• Rate of growth of GDP • GDP composition
– industry – agriculture – services 34% 13% 53%

– remarkable in the last 5 years

Chart GDP Romania 2001-2006

9. Alcatel. OMV. Carrefour . Orange.ROMANIA: Economy • Stable exchange rate • One digit inflation • The labour force . Renault. Metro Cash & Carry. Lafarge.5 million people work abroad The average salary is slowly rising The productivity is still low Local investments and FDI Companies of hundred million dollars each investments – modernized old state owned companies – made greenfield-type – Mittal Steel. Vodafone.3 Million • • • • – not hit by unemployment . EDF.5% – an estimate of 2. Erste Bank.5.

Friden-Holland. East Germany. Ampex. manufacturing. MECIPT–1961. Middle East countries and other markets Technologies became obsolete in the period 1980-1989 due to lack of investments in hard currencies. Memorex.ROMANIA ICT: deep roots in the past • Romania was the first country in Easter Europe to build • first generation computers: CIFA-1957. China. Control Data–USA.000 people workforce Minicomputers “Made in Romania” exported to Czechoslovakia. with research. • • • . service. and DACICC-1962 An industrial base was built in the 1970s with licenses from CII-France. trade and data processing organizations Reaching in 1980s a 40. etc.

production or • • – a process of acquisitions & mergers – entry in EU will probably accelerate this process – largely recognized as on of the best in the world of ICT – 5. digital literacy and content availability are being yet inadequate . affordability. • 8.000+ software and IT services companies in Romania • Many multinationals started create R&D.ICT in Romania 1990-2006 • All world major ICT companies arrived in Romania • Romanian ICT best assets • Romanian education system – human resources – a quickly developing market.000 new graduates enter the labour market every year – Brainbench Co. puts Romania first based on the number of skilled programmers in Europe service centres in Romania Various reports appraise eReadiness of Romania But the IT accessibility.

trade and • Computer software and computer services • Highest increases of 32-42% .IT in Romania 2003-2009 • High rate of all IT sectors in the period 2003• 2005 continuing 2006-2009 Computer hardware looks a little bit saturated – Hardware spending will grow 10% in 2007 vs.5% – IT services 21. 2005 – continue their high rate of growth – software will mark a substantial 31.5% – services. financial communications and banking.

Romania: ICT Facts and Findings 2006 vs. 2003 Chart Main ICT Indicators Dynamics 2006 vs. 2003 .

00% 2.333 24% 5 22.00% 2. IDG.3% 58. Eurostat.Romania: ICT Facts and Findings 2006 vs.33% 1.66% 2.44 90.9% 140% – Sources MCTI.412 35% 8. 2003 • • • • • • • • • Population GDP ICT /GDP ICT Spending/GDP ICT Spending Computer users Cards issued Card Penetration Mobile phone users million $billion % % $billion % million % % 2003 22.5% 60% Rate -4.8% 70.2 7.5 38.9% 45.4% 25% 2006 21.0% 71.4 57.7% 14.3% 14% 80. INS RO.8 8. Gallup .

Romanian IT Industry 2000-2009 Chart Romanian IT Industry 2000 .2009 .

Vodafone.Communications in Romania 2003-2009 • The communication market: similar evolution • In 1989 Romania had only a 10% telephone • • penetration Romania .one of the first European countries to fully liberalize communications market Now 20% penetration of fixed line telephony – one big operator Romtelecom – 74 alternative operators – 4 big operators Orange. Cosmote and Zapp (CDMA) with a • The mobile market .

Romanian Communications Industry 2001-2009 Chart Romanian Communications 2001-2009 .

Internet in Romania • The Internet penetration is explosive • 980 Internet Service Providers • In 2005 a number of 1.8 million access places – dial-up access being in regress – Broadband access 41% of the total a rate of 96% increase over 2004 – 28% • Rate of penetration of Internet in 2005 .

less than EU25 average.. • ICT diffusion vs GDP • Romania at rank 66 from 180 countries surveyed – a middle position among the Eastern European countries – this rank evolved from 77 in 1998 to 66 showing a positive trend – Most of the other countries of the region listed show the same trend – rank countries according to ICT basic indicators .Digital Divide & Regional Aspects • The country is still affected by Digital Divide – – – Internet penetration still low ICT spending per capita far from EU15 average.

researchers 50-60 years old • Brain drain • Dispersion in many small R&D units – – – – • 50 people per R&D Lack of orders and research grants from the industry 607 R&D units 34 National R&D Institutes in 15 research fields 227 public research institutions 310 joint-stock public or private companies .000 in early 1990s to 58.000 in 2005 – 30% of total in 2002 – 26% in 1995 • Continuously diminishing workforce • Aging workforce.R&D • R&D capacity of Romania decreased gradually after 1989 • Dismantling of old state owned research institutes – decreasing orders – outflow of researchers to new private companies or to better positions abroad – from 150.

2 0.428 52 Romania 0.582 0.ICT Diffusion Index 2004 ICT Diffusion Index 2004 0.499 37 Hungary 0.64 0.5 0.364 73 Ukraine 0.494 39 Bulgaria 0.607 0.321 0.349 0.1 0 Access Index Connectivity Index ICT Diffusion Index Rank Slovakia 0.184 0.383 66 Turkey 0.342 81 37 39 52 66 73 81 90 80 70 60 50 40 30 20 10 0 Chart ICT Diffusion Index 2004 Source: UNCTAD .543 0.8 0.6 0.7 0.678 0.4 0.535 0.248 0.3 0.141 0.193 0.

2004 95 85 75 65 55 45 35 Slovakia Hungary Bulgaria Romania Turkey Ukraine 1997 47 45 55 77 78 82 1998 47 43 59 84 74 83 1999 47 44 60 87 71 81 2000 47 42 60 89 70 79 2001 47 39 58 77 68 90 2002 45 39 57 70 71 90 2003 45 37 56 68 75 85 2004 37 39 52 66 73 81 Chart ICT Diffusion Rank 1998 – 2004 Source: UNCTAD .ICT Diffusion Rank 1998 .

EIU Innovation Performance relative to EU average Chart 1 EIS Innovation Performance 2005 relative to EU Source: The European Innovation Scoreboard 2005 .

– Ministry of Communications and Information Technology – Romanian Academy – other ministries and agencies – most of them have the specifics of ICT (Software Park Galati. mostly in software & ICT applications • Industrial & Software Parks 7 other • ICT Task Force . MinatechRo Bucharest. etc. CyberLAB Slobozia.). Softex Braila. CTT-Baneasa.ICT R&D • Reflection of general R&D • ICT R&D • Romanian ICT R&D distinctive in • – low public & business funding – poor collaboration of the ICT SMEs • Coordinators – business sector. universities – Ministry of Education and Research. – ICT multinationals open and the trend continues – R&D centres in Romania. – support of the implementation of Information Society in Romania – little is known about the role of this high ranking body that after the 2004 several areas: Innovation in software field is higher than statistics show – No marketing channels to make known the innovation capacity of Romanian ICT R&D in SMEs and its potential for EU ICT R&D. Software Park Brasov.CIFATT Craiova. IPA SA . specialized institutions.

wideband communications. mobile communications. etc. microsystems.International support to ICT R&D • FP5. FP6 and forthcoming FP7 are the main • • international drivers Romania has participation in all these programs FP6 compared with FP5 – Romania had 3 times less proposals – budget 5 times bigger that in FP5 – main Romanian participation .software technologies. – not best exploited by Romania – grants received were less that Romania’s contribution • Opinions that ICT related FP5 and FP6 .

26 MEuros – In conditions of a reduction of duties • FP6 – 3114 proposals – 247 accepted .289 MEuros – Projects and contracts .39 MEuros – Deficit .International support to ICT R&D • Romanian contribution in 3 years 65.

success stories and setbacks • The main driving force – Country’s progress in developing ICT infrastructure. both public and business – GDP/capita vs.Driving forces. ICT spending Chart ICT Spending and GDP per capita 2000-2009 . problems.

Driving forces. . software and • • • • • hardware 90%+ of turnover of ICT companies is produced by branches of ICT multinationals or joint ventures Some have Romanian R&D centres output is exported with a small margin often re-imported with commercial margin Expect quick increase of absolute value of ICT business R&D in Romania – less effect on the general performance of ICT industry. problems. success stories and setbacks • Lack of enough national ICT R&D • very high rate o imports of R&D.

ICT R&D and societal development: The Four Pillars • ICT development is a must and is a condition for societal progress. • To bridge the gap most of the countries have to build the four pillars – Appropriate ICT Infrastructure – Accessible and Affordable Internet Access – Generalized Ability to Use ICT – Availability of Useful Content .

a new starting point? • The European Institute of Technology (EIT) • IT STAR could play a role – regional branches? . • FP7 .R&D and international co-operation • The necessity • Less understood and less practiced – – – regional cooperation in ICT R&D experience the same problems transfer of experience is more natural – wide accepted – basic activities in EU.

ro President Dr.A Bridge to Romania • The Association for Information Technology and Communications of Romania (ATIC) – organization aiming to consolidate an appropriate framework for the development of IT&C in Romania – maintains a database for co-operation projects available to members – disseminates information to non-members • Member of WITSA (World Information Technology • • • Software Alliance).org.ro .atic.ATIC .org. CEPIS (Council of European Professional Informatics Societies) and IT STAR http://www. Vasile Baltac Contact: officeATIC@atic.

Thank You!! Q&A? .