Prospects of the ICT sector in Greece

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Study of the ICT sector in Greece: Current Situation and Future Trends Deliverable 14: Prospects of the ICT sector in Greece-policy implications are exceptionally important, because they refer to a platform already known and widely used. In the area of procurements, a new National System for E-procurement will be soon completed. It refers to the modernization of the framework around public procurements by instituting electronic methods for public offerings, thus effectiveness and transparency of the processes. Finally, there are some delays in the harmonization of the national legislation with the European that result to continuous cautions by the responsible Commissioner. EETT is strengthening and becomes more independent. Additionally, the law of electronic communications is planned, while the new National Regulation of Distribution of Areas of Frequencies and the National System of Management and Monitoring of Spectrum were published. 3.5. Conclusion By summing up, the domestic ICTs sector is growing in an environment characterized by high growth rates and improved economic climate. Despite the small deceleration during the last two years, the macroeconomic environment for the ICTs sector remains favourable. Private consumption and investments (private and public) can contribute to the further growth of the ICT sector, despite the upward trend in interest rates. It should be noted however, that an environment of a strong domestic demand and high growth has been shaped since 2000, but this did not deter the recession of the international and domestic demand for ICTs. This means that the favourable macroeconomic environment is not a necessary and mandatory condition for the development and increase of demand for ICTs products and services. At the same time, the long established structural problems of the Greek economy and the delays in the implementation of the planned reforms create a competitiveness deficit and create difficulties that touch upon the ICTs sector as well. Besides, most of the problems, the later face, do not differentiate from the usual problems that Greek firms in general face. Consequently, the effectiveness of policies that concern the IS is maximized to the degree that the long lasting problems of the Greek economy are improved. These policies not only increase, as it was stated earlier, but they are also included as an additional dimension in other policy areas as well (employment, investment, infrastructures, etc.), while they are extended to the entire spectrum of socio-economic activity of the country. 4. Main Findings - ICTs’ future prospects October 2006 Observatory for the Greek IS 22
Study of the ICT sector in Greece: Current Situation and Future Trends Deliverable 14: Prospects of the ICT sector in Greece-policy implications In the following section, some of the basic findings of the study are presented, in order to map the basic characteristics of the domestic sector and the factors that support our view about its prospects. This section consists by two parts. At the first one, the growth sources and the barriers for the ICT sector are explored, while at the second one, these are indexed and summarized. 4.1. Basic findings: Sources and Barriers / for growth in the Greek ICT sector The domestic demand for ICT products / services is problematic The basic characteristic of the domestic demand for ICTs products/ services is its small magnitude, which in combination with the limited exports so far lead to a problematic and scattered total demand for ICTs. Three are the key client categories that form domestic demand: a) Retail which is supported by wholesaling distribution, b) firms (large and SMEs) and c) the Public. More specifically: The primary demand created by the Public sector is of small magnitude: the formation of a secondary demand by more familiarized citizens and firms is more crucial and substantial Demand from the public sector in quantitative terms is not that important and does not create the conditions of a steady and powerful corresponding demand. Furthermore, these limited resources are not used sufficiently and efficiently conveyed to the market. Despite the precise and correct design, the Public Administration’s problems and the legislative difficulties, hinder the implementation of the projects. In parallel, it seems that the emphasis is not placed on the actual service to be provided, but rather there is a simple transition of paperwork to an electronic environment (electronic bureaucracy). A simple implant of a system in the Public sector may lead to an unused and ultimately dead box, if the services that it is planned to provide have not undergone any organizational changes 10 . The small magnitude of that side of demand provides a good rationale for the limited number of ICT firms, which depend their survival on the public sector. Indeed as field research shows, the public sector constitutes the basic market only for the 10% of firms, although their majority (more that 60%) sells at least 1% of its turnover to the State 11 . Despite the opinions for under-priced projects, the large enterprises of the sector participate to the 10 Field research on ICT firms, 2006 (deliverable 5b), Round table Discussion (6/7/2006), Observatory for the IS. 11 Field research of ICT firms, 2006 (deliverable 5b) October 2006 Observatory for the Greek IS 23
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Prospects of the ICT sector in Greece

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