Results of the 1st quarter: Export of IT services has increased more than 3 times

The IT sector of Uzbekistan is demonstrating record growth rates. The country continues to successfully realize its potential and creates more and more opportunities to attract foreign companies.

IT Park Uzbekistan also makes a significant contribution to the development of the sector. Data for the 1st quarter of 2023 show that the IT sector maintains a positive dynamics.

Residency in IT Park

For example, according to the results of the 1st quarter of 2023, the total volume of services provided by residents amounted to 2,381.0 billion soums. Compared to the same period last year, the volume of services rendered by IT Park resident companies increased by 292%. For comparison: data for the 1st quarter of 2021 amounted to 438.6 billion soums, and for 2022 – 814.0 billion soums.

In terms of directions, the volume was distributed as follows:

• Development – 1 358.4 billion soums;
• Processing – 839.9 billion soums;
• Education – 25.6 billion soums;
• BPO – 157.1 billion soums.

Export volume of IT Park residents increased by 327% compared to the 1st quarter of last year and amounted to $57.2 million. Of these, 48% are in the United States, the rest – in the UK (15%), Singapore (10%), CIS countries (10%) and others (17%). By the end of 2023, exports are expected to reach $300 million.

In the first quarter of this year, the number of IT Park residents amounted to 1,262 companies, of which:

 – 876 residents are in the city of Tashkent, the remaining 386 residents are registered in the regions;

 – 382 companies work for export;

 – 172 - BPO companies;

 – 256 companies provide educational services in the field of IT;

 – 185 companies with foreign capital participation.

The main share of residents works in the following areas:

• software development and support (61%);
• data processing (5%);
• IT education (20%);
• BPO (14%).

In the first quarter, 207 companies received the status of IT Park resident, of which 61 companies are exporters with a planned export volume of $55 million by the end of this year.

At the same time, 71 companies were denied the status of a resident, and 63 companies were deprived of this status for failure to fulfill the obligations specified in the contract. Also, in relation to these companies, a notification was sent to the tax authorities to cancel the benefits provided and restore obligations to pay taxes to the state budget.

Additionally, thanks to the benefits provided, IT Park residents create additional jobs and increase the number of IT specialists in our country. Thus, in the first quarter of this year, more than 2,100 jobs were created in resident companies. The total number of employed specialists amounted to more than 20,000, which is 12% more than at the end of 2022.

We remind you that IT Park residents are IT companies and IT training centers that can receive a number of significant benefits:

• income tax — 7.5%;
• corporate tax — 0%;
• unified social payments — 0%;
• customs payments when importing goods for own needs – no.

Also, IT Park residents have the right to pay wages and dividends to foreign specialists and founders in foreign currency in non-cash form to international payment cards within the limits of export earnings. Additionally, IT Park residents are provided with the Virtual Office service, which makes it possible to work remotely without renting a room.

Development of the startup ecosystem

IT Park organized (including in partnership with other organizations) 8 events and 5 programs aimed at supporting start-ups, among which the largest were:

• the first wave of the Plug and Play Uzbekistan acceleration program
•  the second wave of the AloqaTechLab corporate accelerator
•  international startup exhibition Tumaris.Expo

For the 1st quarter of 2023, Uzbek startups managed to receive funding from state bodies in the amount of more than 17 billion soums. At the same time, more than 12 billion soums were received by startups from Jizzakh, more than 1.4 billion soums – projects from Navoi and more than 1.3 billion soums – startups from Bukhara. The amount of foreign financing for the 1st quarter of this year reached $1,904,000.

In partnership with AloqaVentures corporate venture fund under AloqaBank the second wave of the corporate acceleration program AloqaTechLab was launched, which implies a 3-month intensive program of startup pitching and packaging and consists of training sessions with experienced foreign and local mentors from various fields, as well as 1:1 sessions with trackers that help startups ensure rapid growth of sales and other key metrics. Sixteen startups in artificial intelligence, big data, financial and corporate technology became participants of this acceleration program.

Recall that under this startup support initiative, 26 startups successfully completed the program last year, and startups Beatify, The Mind and Cradle attracted investments totaling $250,000.

Also, 2023 began with the victories of startups from Uzbekistan in international competitions:

• Uzbek startups Tass Vision and Billz became the finalists of Silkway 2023*.

*Silkway 2023 from Google for Startups and Astana Hub is an acceleration program, within which participants got the opportunity to upgrade their business, receive mentoring and training from Google for Startups and Astana Hub.

• Donʼt waste* startup participants who represented Uzbekistan at the Best Global M-Gov Award Contest organized by the UAE government as part of the World Summit of Governments received a prize of AED 500,000 (US$136,000).
  
  *“Donʼt Waste” is a project aimed at organizing the effective use of food and consumer goods without throwing them away, to act as a navigator for those who need to find them.
   
• Startups from Uzbekistan such as: Sug'urta Bozor, Paylov, Didox, Finiso.io, Smartup X, UYSOT, Ruby Fleet, botcommerce, Beautify, Mazzami, Mohirdev, Monetary, Royal Taxi, Mento, TASS Vision, Pivot Ad were selected for  participation in the first wave of the Plug and Play Uzbekistan* acceleration program, totally, more than 120 startups applied for this program.

* Plug and Play Tech Center is a global innovation platform headquartered in Silicon Valley. They have offices in over 50 countries around the world, including Uzbekistan. Accepted startups will have access to work with corporations and government agencies in Central Asia, as well as assistance in entering the international market and attracting investments.

Development of IT education

The success of the development of the IT industry depends on a literate population, especially young people.  IT Park has taken a number of measures to improve literacy and IT culture in general.

Particularly, in the first quarter of 2023, 7,395 people were trained in 205 IT Park IT Centers, of which 2,280 are civil servants, and the remaining 5,115 are young people under 30.

Additionally, the second phase of the One Million Uzbek Coders project has been launched, under which more than 1 million people will have access to prestigious IT courses from more than 240 leading international companies and educational institutions on the Coursera platform. By the end of the first quarter of this year, more than 37.6 thousand people have registered on the platform, of which more than 24 thousand are currently actively studying. It is noteworthy that 39% of students are girls, and Math&Data (74%) became the most popular area for learning, followed by Development (12%), Soft skills (11%), Artificial intelligence (2%) and Cloud technologies (1%).

At the same time, training centers, young boys and girls acquired the opportunity to study IT by receiving a targeted loan for training through the Bilim IT Center. Thus, in the 1st quarter, this center also showed active growth in both B2C and B2B sectors, covering more than 70 students who received targeted loans in the amount of 768.5 million soums, as well as more than 200 students who were able to find a job. There are currently more than 20 training centers and 150 courses on the bilgi.uz platform, for which everyone can receive targeted loans for studying in installments

At IT Park University, the total number of students enrolled in bachelor's programs for the 1st quarter of this year was 263 students, of which 201 are men and 62 are women. Also, 113 students are on the Foundation program. And the 8 most successful students from the 1st year are doing internships in Latvia, Lithuania and Poland. The university plans to enroll 500 new students in the 2023-2024 academic year.

Moreover, in the 1st quarter of this year, 111 young people successfully compensated their expenses for obtaining international IT certificates, in general, more than 196 million soums were paid. At the same time, the list of compensated international IT certificates has expanded from 184 to 216, and now 139 of them are professional, 49 intermediate and 28 initial certificates.

Regional development

For the 1st quarter of this year, IT Park opened its regional branch in the Tashkent region and an additional building for a branch in the Republic of Karakalpakstan, as well as 2 IT Academies in the Kashkadarya and Khorezm regions.  In total, at the moment there are 12 branches of IT Park in the territory of the Republic of Uzbekistan.

International activity

The main focus of IT Park development for this year is aimed at developing and strengthening international relations.  For the 1st quarter of 2023, IT Park delegations paid a business visit to 7 countries of the world (Germany, Spain, Great Britain, UAE, India, Kazakhstan, Singapore).

Participated in 6 international events and organized 39 business meetings with foreign companies and organizations.  During the same period, the IT Park team held more than 120 face-to-face and remote meetings with foreign representatives from more than 30 countries.  Numerous negotiations resulted in joint projects, signed memorandums and more than 30 attracted foreign companies in Uzbekistan.