Croatian IT spending in 2007 will reach 5.9 billion kuna

A study by the independent international analytical firm IDC titled “The Economic Impact of Information Technology” has shown that 46 percent of all jobs in the Croatian IT sector stem from Microsoft’s ecosystem. IDC also predicts that in 2007, companies within Microsoft’s ecosystem will generate ten kuna in revenue for every kuna of Microsoft’s revenue in Croatia.

The study on the economic effects of information technologies in Croatia is part of a global IDC research conducted in 82 countries worldwide with the aim of better understanding the role of technology in development and quantifying the direct impact of information technologies on the economy. According to IDC, Croatian IT spending will reach 5.9 billion kuna this year, resulting from a consumption growth rate of 8.1 percent.

Such growth is expected to continue until 2011, during which the domestic IT sector will create more than seven thousand new jobs and stimulate the establishment of over 200 new IT companies. Expressed as a percentage of gross domestic product (GDP), IT spending in Croatia accounts for about 2.3 percent, compared to 1.7 percent in the Central and Eastern Europe region. IDC predicts that investments from Microsoft’s ecosystem in Croatia in 2008 will exceed 440 million kuna, focusing on infrastructure, people, marketing, and business development.

The study shows that the total number of employees in the Croatian IT sector is 26 thousand, of which about 12 thousand are related to Microsoft. However, despite the fact that 16 percent of total investments relate to software, a large number of employees in the IT industry, 52 percent, are involved in the segment of software development, distribution, installation, or servicing. This percentage is higher than in other Central and Eastern European countries (39.8 percent). Software spending in 2007 in Croatia amounts to one billion kuna, and the software segment is growing at a rate of 10 percent. IDC predicts that in the next four years, the IT sector in Croatia will generate 2.2 billion kuna in tax revenue and 4.8 billion kuna in GDP revenue. IDC’s data has characterized the Croatian market as an emerging market.

-Software is the main driving force behind the overall impact of information technology on economic results, employment in the IT industry, and, generally, the national economy. It is expected that Microsoft, as the largest software supplier in the country, will make its corresponding contribution. This project is one of the few that connects the application of software and its economic effects. The value of the study also lies in the fact that its findings further encourage the use of software to enhance overall productivity and well-being, said Boris Žitnik, director of IDC Adriatics.

The director of Microsoft Croatia, Davor Majetić, emphasized that the IDC study quantifies the exceptional importance of software in job creation and economic development. He also pointed out that Microsoft’s commitment to developing a sustainable ecosystem of IT companies and contributing to the economy is reflected, among other things, in a series of projects that the company is implementing in Croatia as part of the global Unlimited Potential initiative. -As part of the Unlimited Potential initiative, and as emphasized in the IDC study, Microsoft is committed to opening social and economic opportunities through programs and products that contribute to transforming education, supporting the enhancement of innovation at the local level, and promoting employment. Through a series of projects within this initiative in Croatia, our goal is to help create the conditions and environment where people, with the help of technology, can create competitive advantages and realize their potential, said Majetić.

The Unlimited Potential initiative in Croatia encompasses a range of cooperation programs with the educational community, projects supporting regional development, supporting the development of a knowledge society, and promoting innovation and enhancing competitiveness through the use of information technologies. One of the significant projects within the Unlimited Potential initiative in Croatia, Microsoft’s Business Technology Center in Varaždin, is currently celebrating its two-year anniversary. The center has confirmed its role as an institution focused on creating and supporting sustainable small and medium IT companies through its achieved results. Since its establishment in October 2005 until October 2007, 1213 individuals from 210 IT companies have passed through the programs of the Microsoft Business Technology Center, in the form of formal training or technical assistance in software development. This has exceeded some of the goals set for the first 30 months of operation. The center is also associated with the development of 45 new products and the establishment of 20 new companies. (M.N.)