Software exports rise for developing and transitional countries
We have pioneered a framework to increase exports of software products through business clustering and the creation of dedicated software export companies. Costa Rican and Egyptian software exports have become globally competitive as a direct result of our work.
The framework arising from our research has been followed by a number of countries globally to assist the development of their software export policy and strategies. Quantifiable effects are evident in Costa Rica and Egypt.
The Inter-American Development Bank funded work in Costa Rica using our Software Exports Success Model to analyse existing export clusters and set up a series of task force groups. The project established the Costa Rican National Strategy for Software Exports.
- Creation of a national programme, “CENTRAL GATE”, to widen out existing clusters to include contact centres, back office support, digital media, software development and related services
- Growth of the digital sector from 150 to 805 companies
- Internationalisation of the software sector with more companies “born to export”
- Recognition of Costa Rica as mature software provider in the global market.
Policymakers from Egypt’s Information Technology Industry Development Agency adopted our Software Export Success Model to design their action plan to promote Egyptian software exports. Our research is cited extensively in national strategy documentation.
- Rise in software exports from $250million (2005) to $1.1billion (2010)
- Creation of 60,000 jobs in the sector and 150,000 additional indirect jobs by the end of 2010
- Increasing attractiveness of Egypt as an offshore location, moving from position 13 on the A.T. Kearney Global Services Location Index in 2007 to position 4 in 2010.
Through our analysis of case studies in India, China and Russia, we provided an evidence base to prove the value of cluster for exporting software. We also showed that support for institutions in the sector could drive strong growth of IT businesses in developing and transitional economies.
Our work formulated the Software Export Success Model which is founded on five key considerations:
- National vision and strategy
- International linkages
- Software industry characteristics
- Supply factors and infrastructure
We applied the model to the emerging software export markets of China, Russia and Iran to test its value.