Georgia as the Regional ICT Hub and Ecosystem for Partnership

Irakli KashibadzeHead of Communications, IT and Innovations

Department

Ministry of Economy and Sustainable Development of Georgia

• Georgia's geographic location makes it attractive as a regional center for the South Caucasus and Caspian regions;

• Due to their geographic location, proximity to the EU and the Middle East, Georgia has access to a much wider market opportunities of ICT services for less and not limited only to the Caucasus and Central Asian regions to be shipped.

• Flight time to Istanbul, Kiev, Moscow - 2 hours, Dubai –3 Hours, Berlin and Prague 4 hours.

According to 2011 data, exporting of automobiles is on first place among other products in the export list of Georgia

Economic Reforms

• Min 4o minute - Max. 3 days are needed for running a new business in Georgia;

• On the ground of tax code changes, based on a simplified tax system converted 21 tax payments into 6;

• The corporate income tax has been lowered to a 15% rate. The VAT single rate was reduced from 20% to 18% in 2005.

No of taxes

21 in 2004

6 in 2013

The rank of Georgia according to economic reforms among world organizations

According to the research, of “The Global Information Technology Report of the World Economic Forum 2013”, Georgia is on 65th on network readiness index rankings among 144 countries.

According to indexes of The World Bank 2013, Georgia has occupied 21st position in terms of economic freedom, and the 11th position in the European Region.

Hong K

ong (1

)

Singa

pore (

2)

Austra

lia (3

)

Georg

ia (2

1)

Lithu

ania

(22)

Belgium

(40)

Latvi

a (55

)

Bulgar

ia (6

0)0

102030405060708090

100 89.3 8882.6

72.2 72.1 69.2 66.5 65

The rank of Georgia according to economic reforms in the world

According to the research of “Transparency International 2012”, with 52 points Georgia is on 51st position among 176 other countries. Where 0 means extremely corrupted, while the 100 - means very clear public sector.

According to the World Bank’s report 2013 on doing business, Georgia ranked as No.9 among 185 countries.

Singapore

Hong Kong

New Zeland

Georgia

Latvia

Estonia

Lithuania

Armenia

Azerbaijan

Turkey

Russia

Ukraine

0 20 40 60 80 100 120 140 160

1

2

3

9

21

24

27

55

66

71

120

152

on 2006 ranking was 112

Georgia's ranks of ICT, ITU and EBRD report

According to the European Bank for Reconstruction and Development(EBRD) research result 2012, regarding the 31 countries electronic communication sector Comparative Assessment, Georgia has received the high evaluation.

Compared to the CIS and Caucasus region countries, ICT field in Georgia is one of the most rapidly developing and expanding.

Statistical indicators of the ICT sector

In 2012 fixed networks subscribers number increased 1 440 000 and subscribers density for 100 inhabitant reached 32.7 %

In 2012 mobile networks subscribers number increased 4 800 000 and subscribers density for 100 inhabitant reached 109 %

2005 2006 2007 2008 2009 2010 2011 20120

200000

400000

600000

800000

1000000

1200000

1400000

1600000

570500 592300 607000 647989

830222

1105883

13425481440000

Fixed Networks Subscribers

2005 2006 2007 2008 2009 2010 2011 20120

500000100000015000002000000250000030000003500000400000045000005000000

14154001704100

2401100

28468223060438

39800004406817 4800000

Mobile Networks Subscribers

2005 2006 2007 2008 2009 2010 2011 20120.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

32.2% 38.7%54.6%

64.7% 69.5%

90.5%100.0%

109.0%

Penetration of Mobile Subscribers per 100 population

2005 2006 2007 2008 2009 2010 2011 20120.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

13.0% 13.5% 13.8% 14.7%18.9%

25.1%

30.5%32.7%

Penetration of Fixed Subscribers per 100 population

Statistical indicators of the ICT sector of Georgia

In 2012, the number of Internet users reached 1.7 million and subscribers density for 100 inhabitant reached 38.6 %.

2004 2005 2006 2007 2008 2009 2010 2011 20120

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

110000140000180000220000350000

1000000

1200000

16379051700000

Internet Users

2004 2005 2006 2007 2008 2009 2010 2011 20120.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

2.5% 3.2% 4.1% 5.0%7.9%

22.7%

27.3%

37.2% 38.6%

Penetration of Internet Users per 100 popu-lation

Fiber-optic infrastructure in Georgia

In the country actively growing urban coverage zone by fiber-optic backbones, actually most of the cities are covered by high-speed optic backbones. Georgia has several interconnections with Europe through the Black Sea, Turkey and Russia. We have optic interconnections with other neighbors including Armenia and Azerbaijan

Implementation of different events for ICT industry development by the government of Georgia

• In Georgia for several years in ICT field is simplified licensing procedures, new entrants on the market only needs to authorize to start an operation, licensing is needed only for acquiring radio frequencies. This has also eased procedures for companies willing to start operation in this field consequently, has promoted competition on the market.

• IT zones have been created since 2011 in Georgia. At the moment there are 37 different companies Export oriented IT software companies and the income is 10 million of total revenue, from services rendered by exports, but the potential is much bigger;

• Since 2010 in Georgia has been carrying out IT Startup Days, with the aim of providing technical assistance IT startup companies by the government;

• The Government of Georgia supports to developing of e-services, such as: e-government, e-learning, e-health, etc.

• In Georgia was implemented "Deer Leap” project, according to that, all schools of the country was equipped with computer classes interconnected to internet network (from 2005 much then 37 000 computers are delivered in all schools in Georgia;

Implementation of different events for ICT industry development by the government of Georgia

• Georgia has established a national numbering system of electronic communication networks, which is elaborated by the standards and guidelines of ITU, CEPT, and ETSI requirements. The increasing numbers promote attracting new business companies in Georgia;

• Data center development works are underway in Georgia. The low cost on electrical energy promotes Data Center construction in Georgia.

• In 2011 there was established Google Developing Group in Georgia, which was ranked at 5th place with its activities among the other groups working on Google issues in specific countries.

• The switchover process from analog into the digital broadcasting is in its active phase in Georgia;

Brands such as TeliaSonera, Deltacom, Beeline, Microsoft, Lotto, Hyundai, Marriott, Radisson, Puma, Ferrero, Lebek, Sheraton, etc. are presented in Georgia;

Irakli KashibadzeHead of Communications, IT and Innovations

DepartmentMinistry of Economy and Sustainable

Development of Georgiaikashibadze@economy.ge

Thanks for your attention!