- Hits: 17505
With an annual growth rate between 2.3 and 7.7 percent over the last several years, the Macedonian Information and Communication Technology (ICT) sector is a promising area for U.S. companies. The ICT sector benefits from a skilled and cost effective workforce with excellent English language skills, solid telecommunications infrastructure, and low corporate tax. ICT representatives expect the sector will continue to grow.
The total ICT market value in North Macedonia was an estimated €352 million in 2017. Hardware is the largest segment (55 percent) of the Macedonian ICT market. ICT services are the second largest segment (30 percent), and software comprises 15 percent of the ICT market.
Many large ICT companies, such as Microsoft, Cisco, Oracle, Dell, Compaq, Hewlett Packard, IBM, Sun Microsystems, Apple, and Lotus, are present in North Macedonia via branch offices, distributors, dealers, resellers, solution providers, and business partners.
The interest in software exports has been mainly spurred by four major factors.
• First, on the demand side, there is a growing trend among Western European and American companies to outsource software related tasks and activities to lower-cost destinations thereby creating substantial market opportunities for Macedonian software and IT services companies.
• Second, on the supply side, North Macedonia has significant comparative advantages, such as lowerlabor costs and highly skilled human capital.
• Third, like in many other transformation countries, the Government of the Republic of North Macedonia recognized the strategic importance of the software industry for the development and competitiveness of its national economy. Being a cross-cutting technology, promoting the software industry is a well-proven measure to increase productivity, efficiency and innovation as well as to facilitate industrial transformation towards a knowledge based economy.
• The fourth factor contributing to the importance of software exports for the development of the Macedonian economy is the country’s limited domestic market. Thus, export becomes an issue of paramount importance for the development and growth of the software industry. For small national economies like Macedonian ward-oriented import substitution policies are no option, instead they have to refer to outward-oriented export-led growth.