Money, people, and residents: Uzbekistan's IT sector gains three new impetuses

The president of Uzbekistan Shavkat Mirziyoyev signed a resolution on May 24 that aims to increase the reach and quality of digital services offered in the state.

Over the past few years, such documents have been regularly adopted.

Each time they become a new impetus for Uzbekistan's IT sector since they put forward new prospects.

Among other things, the current document involves fundamental adjustments that have the power to alter entire markets.

Businesses acquired a permission for online product sales from a free warehouse

A free warehouse is a customs regime when goods are stored in a certain place without being subject to taxes and customs duties.

Such goods can be sorted, processed, packaged and so on.

Before the sale begins, the products are moved to other modes, such as free circulation or export, but at that point, duties and taxes must be paid.

According to the resolution, Uzbek business owners will be able to engage in e-commerce in the free warehouses customs regime as of October 1, 2023.

This is a fundamental change that will dramatically increase the volume of online trading, as it will greatly reduce costs.

Online stores, marketplaces, and other businesses engaging in Internet commerce now have a significant competitive edge as selling items from a free warehouse in offline trading is still forbidden.

This move is anticipated to lower the amount of the shadow economy in the nation and increase e-commerce trade turnover to $500 000 annually.

Venture funds, IT accelerators and design studios can now become residents of IT Park

The range of activities available to IT Park residents is progressively expanding. In 2019 there were only 4, in 2020 - 18.

The resolution adds the following three:

● Development and delivery of multimedia and design services, including the creation of software-animated products;

● venture funding of IT projects and the launch of an acceleration program for companies located in the IT Park;

● eSports services.

Uzbekistan experiences am increasing number of animation and motion studios.

Essentially, these are commercials for numerous businesses, and the majority of them focus on orders from abroad.

Such companies will be able to lower their expenses and boost their proportion of the total export of IT services having the opportunities to become residents.

In terms of venture funding, by 2023 this has emerged as one of the key market trends.

Finally, venture capital has arrived in Uzbekistan. Dozens of deals are now being closed annually, and dozen more funds are operating here.

The situation is similar regarding the acceleration programs; while there were previously none, now several programs have been launched at once.

The state will fully cover the costs of obtaining international IT certificates

A compensation program for up to 50% of the fees associated with earning foreign IT certificates was introduced by IT Park in April 2022.

During the year, over 600 certificates from companies such as Cisco, SAP, Microsoft, Google, Coursera were reimbursed

The decision not only approves the continuation of the program, but also its extension, allowing for 100% compensation starting on October 1, 2023.

The sole requirement for this is proficiency in a foreign language at level B2 or higher.

Since the labor market is becoming more competitive and candidates must be able to stand out from one another, certificates from IT businesses are crucial.

By obtaining certification, one can verify the relevance of one’s knowledge and get official evidence that the necessary skills are in place.

It is advantageous when looking for employment as well; according to a poll made by the International Data Corporation, 75% of employers are certain that stuff with relevant certificates perform better.

One can not buy certificates, but has to pay somewhere between $150 to $500 and more to take the exam.

This is quite an amount for Uzbekistan given the fact that the average monthly wage made up approximately $333 in 2022. In these circumstances, cost reimbursement is particularly relevant.

The resolution also addressed a number of other crucial issues related to employee training.

First, not only will the One Million Programmers initiative continue, but it will also be expanded.

For instance, IT Park, together with Coursera, has already launched a new online course platform Uzbekcoders.uz.

The program of free courses has been completely updated, with over 10 000 courses in data science, artificial intelligence, technology, business and soft skills added.

According to the resolution, 15 000 graduates who are chosen for overseas employment will go through training.

Secondly, the allocation of loans for the purchase of a computer to those who have successfully completed training on foreign platforms continues.

The money granted in the form of a microloan can also be obtained starting on August 1, 2023, on a bank card that has been opened separately.

Thirdly, private training centers will now receive subsidies for each graduate who got a job in an IT Park resident company engaged in the export of IT services.

This will be a one-time payment at the expense of the Digital Technologies Development Fund, up to 75 times the base calculation amount (almost 25 million soums).

If the graduate is a person with a disability, then the subsidy will be up to 105 times the base calculation amount (almost 35 million soums).

Fourthly, now residents of IT Park can engage in IT English training, but only if the income from this activity does not exceed 40% of the company's total annual income.

There are two advantages here. The first one is the development of technical English among young people (it will be easier to get a job in an IT company).

The second is that employees of local IT companies who speak the language well will become more competitive in the international market and will be able to attract more customers. More orders, more work, more IT exports. It's all simple.