Government should respond very quickly to challenges of technology sector – UATE Executive Director
YEREVAN, MAY 26, ARMENPRESS. The professional potential arriving from Russia, Ukraine and Belarus has a strategic importance for Armenia’s technology sector.
In an interview to ARMENPRESS, Executive Director of the Union of Advanced Technology Enterprises of Armenia (UATE), former minister of high technological industry, Hayk Chobanyan, said that the inflow of specialists to Armenia outlined the gaps and problems in a number of directions, which, he notes, the government needs to respond quickly. According to him, all conditions and opportunities should be created for holding the tech specialists in Armenia in a long-run.
-Mr. Chobanyan, during the recent congress of the Union of Advanced Technology Enterprises the results of the works done so far in different directions were summed up. Could you please tell us what are going to be the Union’s priorities taking into account the achievements and the challenges?
-The past one year was an interesting strategic period for the field taking into account the post-war situation. The Union has developed its new strategy, outlined directions which could contribute to Armenia’s recovery. The first direction was again education and the discovery of labor force. This is the reason why the Union’s most large-scale and big projects are directed to education sector. Since 2012 we have entered schools and created engineering laboratories. The youth of our educational programs are already entering the labor market or decide to connect their future with scientific-research activity. Armath educational laboratories comprise the main base in this value chain, their number is over 600, and around 18,000 students are already studying there. Most of them immediately start working in sectoral companies, and the 10-12% establish their own companies.
The next strategic direction is security, which in its turn involves several directions. The first one is the military industry. It is important to consider the following factors for the development of the military industry in Armenia. Military industry is a branch of industry and it cannot develop if there is no development of a general industry in the country. In this case we talk not only about the engineering solutions, but also the production capacities which means development or more correctly restoration of the high technological production. We almost do not have production capacities for servicing the military industry. In this sense creating such infrastructure is a priority.
The next one is the unity of military industrial enterprises, the capacity development, the promotion of their solutions and productions, as well as the creation of a co-existence between them. After the 2016 April War such a platform was created, and we were gathering the companies working in this direction around this platform. Today, in cooperation with the government, we should make a new re-launch on this direction in order to have a different system in several years and introduce new mechanisms for the financing of the military industry.
The next direction is the science development, e-governance or digitization programs. In the past 10 years no significant changes have been made in this respect, and there is again need for a re-launch here. The last direction is the positioning of Armenia in international technological field, its branding in terms of high technologies. Now we are engaged in these issues.
-As the minister stated at the congress, the use of latest technological solutions in all directions of economy is a vital demand today. In your view, to what extent are we succeeding in this respect? In which spheres do we have success, maybe the banking, the financial sector?
-This is an important observation. Of course, there are fields where the use of technologies is more critical, such as healthcare and services. There are sectors where the use of technologies is still weak, for example, agriculture, but we know that the use of technological innovations is the most serious tool to multiply the opportunities of this field. There is a challenge for us in this sense as well.
Yes, you mentioned right that the banking sector, is, perhaps, one of the advanced directions in terms of applying digital technologies, however, recently some problems were revealed especially after the arrival of Russians to Armenia. They complain a lot from our banking services. We understood that we still have a lot to do in this direction. For many years I have worked in digitization sector, I really believe that almost no movements have been made in this direction in the past decade. The years of 2008-2012 have been the most active period of the digitization process in Armenia and now we need to restore it. Armenia’s opportunities in this respect are much greater thanks to the existing high-tech industry. If there are countries whose alternative is just to import different solutions from abroad, in Armenia’s case, these tools and automations could be done thanks to the efforts of local companies.
-You talked about challenges. Let’s speak about the developments connected with the Russia-Ukraine situation. Many companies and specialists from Russia, Ukraine and Belarus are moving to other countries. What is the picture on IT companies and specialists who moved to Armenia? What problems were revealed after their arrival?
-Relocation in IT sector is not something new. This sector is in constant movement, to more developed and less risky markets. For instance, a year ago such process started in Belarus when internal procedures changed, and Georgia quickly reacted and as a result increased the IT volume in its economy. I don’t know why but we are more restrained in these matters. There is competition, countries are in line and want to maximally use the professional potential. I think that from the view of creating respective tools Armenia is reacting quite slowly, because the changes, the legislative, legal ones, existing in Armenia are not compatible with the terms proposed by Georgia and Uzbekistan.
The second problem, which is much more critical is that we do not have a strategic position on this issue because as I said relocation is a regularly happening process. Today people arrive from Russia, Ukraine, tomorrow they may arrive from India, Iran and other countries. In addition, we have a huge community in the Diaspora, most of whom work in technology sector. And the respective tools have a vital significance for our country also in the context of repatriation. We need to more seriously assess this challenge, that Armenia faces as a result of the Russian-Ukrainian war, and have a strategy for such situations.
-What concrete tools do you mean?
-We should have the most favorable legislation, the most favorable conditions for relocation. In case of our compatriots, these conditions should be broader – citizenship, right to work, access to different services, which we do not have. The level of our digital services is quite low. We are constantly dealing with bureaucracy. Our compatriots visit Armenia, spent several hours in passport department which is a disgrace, especially for those strategic circles who are our compatriots. We have a serious problem with real estate, we do not have enough apartments for rent, we do not have high-class business premises. We have multiple buildings, which are called business centers, but they do not meet the international standards. This is a challenge for the urban development field. The development of infrastructure is a priority for us. It is necessary to quickly install special economic, industrial zones and infrastructure in Armenia. This should be done by the support of the government and with co-financing programs. In other words, by taking into account this challenge, we should revise our tools, legislation, conditions, infrastructure, and this should be done very quickly.
-Do you have a statistical data about the foreign companies that moved to Armenia since the start of the Russian-Ukrainian war? There were rumors that these companies are here for a short period of time, what are the trends?
-I will leave the statistics to the authorities. According to the latest data, the talk is about the registration of 70,000 persons and 1300 companies, more than 90% of which are IT companies.
-Even if these companies and specialists stay in Armenia for a short period of time, what impact will it have on Armenia’s tech industry, economy? What opportunities will open?
-It’s very important for us that we create very quickly platforms and use mechanisms that allow the foreign specialists in Armenia to transfer his/her knowledge to the local companies and specialists. As a rule our top-class specialist is working at least with new 5 specialists. This means that by attracting 100 top specialists we could create a working group consisting of 500 specialists, allow 500 young people to develop their skills. We need to understand that this has an investment value and we not only must not take taxes from these people, but also we should co-finance because they arrive here to transfer their knowledge to our children. Regardless of how long the relocation to Armenia will last, all stages are of strategic significance for our country. In line with this, we should work to improve the tools and make these specialists stay in our country longer.
-So, we expect that the inflow of tech specialists will contribute to the capacity development of Armenian specialists and the creation of jobs…
-The result will be seen in economy, science and education sector, as well as in social terms. We know that engineering jobs generate several times more jobs, because they are highly paid specialists and they should also promote the development of other fields. The foreign specialists are a very important resource for our Armenian companies. Our companies are already hiring specialists who arrived from Russia, Ukraine and Belarus. There are hundreds of such cases. There are also examples when Armenian companies are cooperating with the companies that moved to Armenia. By summing up, I want to note that we need a special policy, a detailed program which should have a solid budget, and we should understand that it is an investment, not a charity.
Interview by Anna Gziryan