OUTSOURCING FOR ARMENIA – IT IS NOT SO BAD
Aram Gareginyan
arminfo
2008-04-19 17:13:00
ArmInfo. April 15, 2008. It is no secret that development of
information technologies in Armenia rests on the outsourcing, first
of all, i.e. execution of orders from abroad. Moreover, producers of
all the kinds of computer articles are specialized in this area. The
matter also concerns the developers of Â"independentÂ" programmes and
producers of drivers, that is, software for computer items, as well
as producers of microchips. However, is IT-sector of Armenia able
to establish a full process cycle of production of programmes and
items? Perhaps, a literally planned outsourcing industry is able to
become the primary driving force of IT-sphere development in Armenia
as it already successfully happens in many countries of the world:
quick development of IT-sphere in the countries of South-Eastern Asia
is a convincing example here, Director of the "Competitive Armenian
Private Sector – CAPS" organization, set up in Armenia in 2006 under
assistance of USAID, Hayley Alexander told ArmInfo correspondent about
it and other problems of IT-sphere in Armenia. He also said about the
current programmes of CAPS in the sphere of information technologies,
tourism and pharmaceutics.
Mr. Alexander, will you please tell about the current programmes of
the Fund and their implementation process?
First, I shall start with the programmes in pharmaceutics. We have
recently launched a consumer demand programme on April 10, as one
of the programmes in this sphere, aimed at analysis of assessments
of the present state of the medicines market in Armenia by final
consumers. The results of the poll will be used for consultation
of local producers. We have set two tasks here. The first task is
improvement of the product quality. We are willing to implement
the international production standards in Armenia named GMP (Good
manufacturing products). These standards envisage adherence to the
high level quality at all the production stages. The second task is
implementation of a successful marketing strategy, which includes
correct creation and support of the brand, public information, etc.
At present, the majority of medicines are imported in Armenia from
outside.
Do the Armenian pharmacists need creating new drugs for themselves
or they should tighten the relations with foreign exporters?
I think that both are necessary. Such a small country like Armenia is
hardly able to produce all the medicines it needs. However, there are
products Armenia is quite able to produce at such a level as to meet
the domestic demand, as well as rise the interest of foreign customers.
What drugs is Armenia capable to produce today?
The Armenian companies produce wide-spectrum of drugs. These are pills,
injection preparations and others.
What can you say about the homeopathic drugs, for example, the herbal
medicines?
This is the sphere, where the Armenian producers can achieve serious
success in the international market, as herbal drugs are presently
in a stable demand in the European market, moreover, their production
and use in Armenia are widespread.
What can you say about your projects in tourism, including such a
new direction for Armenia as an Â"adventure tourism?
The adventure tourism – rock climbing, alpinism, crosses, etc. has
great potential for development in Armenia. First of all, this is
an interesting alternative to today’s tourist industry of Armenia,
the main resource of which is the historical and cultural heritage
of Armenia. In fact, Armenia is a country with an ancient history
and there are many valuable monuments of the world culture here,
however, the wider the service spectrum is the more the potential
clients are. In 2007, we organized a fact-finding trip of the Italian
tour operators to Armenia, who were kindly surprised at the perfect
opportunities available here for development of an Â"adventureÂ"
tourism.
Will the new kind of tourism require retraining of guides and other
specialists of the tourist business?
Of course. However, the point is that there are no such specialists in
Armenia, so it is necessary to organize trainings with participation
of foreign specialists. Moreover, employees of the rescue services
may partially replace instructors of the "wild" tourism. Therefore,
we schedule joint programmes with the Rescue Center of the town of
Spitak. I must say that the market potential here is very great,
including from the USA, where both the native Americans and the
Armenians, living in the United States, who have never seen their
historical motherland or left it long ago, show the interest in
Armenia. Such a trip will be an excellent opportunity for them to
know Armenia from inside.
Will you please tell about your projects in the sphere of information
technologies? A visit to the Silicon valley in June, 2008, will become
one of the main events of the year in IT-industry.
We foster great hopes with this trip, so, we started preparing for that
beforehand. In February, we started receiving applications from the
Armenian developers for participation in the trip. The pretenders had
to present a marketing programme or even its project. The best of these
projects were later selected on a competitive basis. During selection,
we were guided by clear perception of the Armenian developers regarding
what they are ready to offer to American companies and what they are
expected of. The projects, where the producers understood the market
requirements and the nature of demand, were selected for participation.
Who else takes part in the trip?
The Armenian delegation will also include representatives of
the state bodies. It is still difficult to call the names of the
participant-companies and representatives of government institutions,
as their staff may change.
The final stage of the competition of Armenia’s IT developers
"Imagine Cup" will be held on April 25, and the main topic of the
competition projects this year is echo-technologies, perhaps, for
the best programmes to be used in practice.
Our partners – Â"Enterprises Incubator FundÂ" (EIF) and the Armenian
representation of Microsoft played a great part in organization
of the competition. Thanks to Microsoft, these projects may become
well-known in abroad and attract investors. As for their implementation
in Armenia, it is quite probable that the state agencies will pay
attention to some of these projects, as the Imagine Cup will be widely
covered in the press.
It is no secret that IT-production in Armenia is mostly based on the
outsourcing. What can be done to overcome the situation, and does it
need overcoming?
To some degree, the outsourcing may be considered as a "fatal evil"
for the countries with transient economy. You see, not every country is
able to develop large-scale projects. However, a number of advantages
may be taken out of it . Many countries – India, China, the countries
of the South-Eastern Asia have built their own IT-industry just on
the outsourcing.
It is also important that there are always the companies among those
in IT leader-countries, for example, in the USA, for which it is of
profit to entrust the developers from another country, including
Armenia, with part of their work. I must say that the Armenian
IT-sector is actively developing today: new companies appear, and
rather serious tasks may be set under these conditions. For this
purpose, we are going to hold a business-forum on June 21-22 jointly
with the Association of IT-developers of Armenia (UITE), during which
possibility of mutually beneficial cooperation of IT-developers and
companies of various economy branches will be discussed.
UITE achieved great success having come through to the final of the
European competition of IT-developers in Stockholm…
It is a great success. Undoubtedly, such a success attracts attention
not only to a specific company but to the country in general. People
start thinking: Â"Information technologies in Armenia? If this company
reached such a serious success, perhaps, the rest ones lag behind it
not so muchÂ".
Taking into account all this, can we say that Armenia is able to
develop the competitive private sector, in the sphere of information
technologies, in particular?
If the state wishes for any branch of economy to develop successfully,
it should assist it. Tax and customs advantages for IT-producers
will become the most efficient support. For example, full exemption
of IT-producers in Armenia from tax and customs may be of a great
benefit. Let them export their developments abroad and sell there
without restrictions. In this case, not only local but also the foreign
producers will show interest in IT-industry in Armenia. Meanwhile,
though they would like to open their business here but high VAT and
duties stop them. One should not forget that there is always a choice
among several possible versions when carrying out investments in any
country, and a foreign investor should have sound reasons to prefer
Armenia to another countries. You know, the sphere of information
technologies develops so headily that all the expenses on it will be
paid off without fail.
Thank you for the interview.
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