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Armenian IT Sector Grows Despite Economic Crisis

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  • Armenian IT Sector Grows Despite Economic Crisis

    ARMENIAN IT SECTOR GROWS DESPITE ECONOMIC CRISIS

    World Markets Research Centre
    Global Insight
    Nov 25 2009

    The participants of an IT conference held in the Armenian capital,
    Yerevan, yesterday concluded that the country's IT sector has been
    growing despite the economic crisis. The conference, organised by the
    Competitive Armenian Private Sector Project (CAPS) and funded by the
    United States Agency for International Development (USAID), highlighted
    the factors that have contributed to the successful development of the
    sector in Armenia, including better cooperation between the private
    sector and the government, recent customs and tax reforms, the rapid
    spread of advanced technologies in the country, and the creation of
    educational institutions that generate highly skilled IT specialists.

    Significance:Armenia has been hit hard by the global economic crisis,
    with GDP dropping by 18%. Against this backdrop, the news of its
    expanding IT sector is encouraging for the Armenian government and
    foreign investors. Since the mid-1990s the Armenian government has
    been taking consistent steps to develop the IT sector. The country's
    17-year blockade by neighbouring Turkey and Azerbaijan due to political
    tensions has played a positive role in IT development. The government
    has funnelled resources into the IT sector since it is an opportunity
    to utilise the highly skilled intellectual pool found amongst the
    Armenian population, without having to rely on blockade-impacted
    transportation. So far IT remains one of the most attractive areas
    for foreign investors in Armenia: there are over 210 IT companies in
    the country, 58 of which are foreign owned. These companies export
    $70US million in products annually to 20 countries.

    The latest entry into the Armenian IT market was the global
    communication company Orange. Indeed, even the Russian president
    Dmitry Medvedev recently stated that Armenia's success in the quick and
    effective introduction of information and communication technologies,
    including universal wireless internet coverage, is a model that Russia
    is eager to replicate.
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