On 30 July 2010, the Applied Research and Communications Fund supported by the German Marshall Fund/Bulgaria Fund organized a policy forum entitled e-Bulgaria: Toward ICT Development via Research-Based Policies. The forum was dedicated to using adequate and reliable indicators for the penetration and usage of information and communication technologies (ICT) when developing policies and assessing their impact.
Mr. Todor Yalamov, Coordinator of the IT Group at the ARC Fund, noted that the current government is a forerunner in developing research-based strategies in the field of ICT that sets concrete goals and measurable performance indicators. Such policy documents are, for example, the National Broadband Strategy and the draft of the e-Governance Strategy, currently under public discussion. In a number of cases, however, coordination among different state authorities responsible for ICT policies is still lacking, and the development and implementation of one sectoral policy often overlooks the needs and priorities of other sectors.
Mr. Parvan Russinov, Deputy Minister of Transport, Information Technology and Communications, stated that in order to be effective, Bulgarian ICT policies need to incorporate the national specifics into the European ICT priorities. According to Mr. Russinov, clear rules and criteria for developing, measuring, and reporting the results from policy initiatives have been lacking in Bulgaria. Thus, now the purpose of the ministry is to develop tools and methods for measuring the progress of and reporting the results from ICT policies. While presenting the draft e-Governance Strategy, Minister Russinov noted that the strategy introduces four strategic areas of development, each setting specific targets, priorities, and measurable indicators for monitoring the implementation and evaluating the impact.
Mr. Todor Galev, Senior analyst at the ARC Fund, stressed on the need for rigorous analysis of key indicators measuring the ICT development in the country. The latter include indicators for research and development (R&D) in the ICT sector and those measuring the penetration and use of broadband Internet among the population and business enterprises. A study by the ARC Fund suggests that the official data on R&D in the ICT sector represent a notable underestimation of the real numbers (i.e. the official data are three to five times lower than the actual data). As main reasons for this discrepancy, Mr. Galev pointed to the inaccurate assignment of firms according to the international classification of economic activities (i.e. many non ICT companies are classified as ICT and vice versa), and the underreporting of R&D by business enterprises. The latter is partly due to fact that, under the current legislation in Bulgaria, expenses on R&D are considered “future expenses”, thus increasing companies’ tax burden for a given fiscal year. Additional reasons are the lack of incentives for R&D implementation and reporting, as well as the phenomenon of over-reporting related to the submission of too much information to a number of institutions. Finally, there is a general lack of confidence in the existing system for protection of intellectual property resulting from R&D (and the dysfunctional judicial system, as related to intellectual property rights), which is a reason for not declaring the R&D activities.
Actions to improve the records on R&D, not only in the ICT sector but in the economy as a whole, include: reducing the reporting burden by re-using information submitted to the administration; simplifying reporting procedures; and creating “soft” incentives for the implementation and reporting of R&D activities.
Contrary to the above, the main issue with indicators for broadband penetration and usage is not underreporting. Instead, standard indicators measuring the use and penetration of broadband are created and defined on the basis of the economic, political, and technological developments in the EU15, thus not correctly reflecting the specifics of the Bulgarian broadband market. According to the ARC Fund, the latter often leads to underestimating the specific features of new Member States, which are key to their development.
A 2010 study by the ARC Fund on the provision of broadband Internet in Bulgaria shows that 91.5 percent of the Bulgarian population lives in a city/village with at least one broadband provider. The study confirmed a lack of reliable and comprehensive data on the country’s Internet infrastructure (i.e. topology, technology, standards, etc.). This is due to a lack of incentives to Internet providers and their non-compliance with some of the existing regulations.
Ms. Milena Kovchazova, Head of the R&D, Innovation and Information Society unit at the National Statistical Institute, presented the institute’s work in improving the data collection on R&D and ICTs’ use and penetration. Ms. Kovchazova noted that a number of the issues addressed in the preceding presentation result from the inability of the National Statistical Institute to change standard methodologies developed by Eurostat. Ms. Kovchazova presented the institute’s latest study on Internet use and penetration among the Bulgarian population and businesses.
The presentations were followed by a heated discussion between Mr. Boyan Zhekov from the Bulgarian Association of Information Technology, Mr. Peter Statev of the Bulgarian ICT Cluster, Prof. Roumen Nikolov of the University of Library Studies and Information Technology, Mr. Antony Slavinski from the Association of Telecommunications, and other participants in the forum. All of the participants expressed their support for the idea that ICT policies need to be research-based and rely on measurable indicators to monitor their implementation. Participants stressed on the need for coordination between different state authorities involved in the planning and implementation of ICT policies. Such coordination is particularly necessary with regards to the use of data collected by different governmental bodies, and compatibility between indicators they use. It was noted that public authorities should make better use of the specific studies carried out by non-governmental and industry organizations.
Ms. Milena Petkova, Director of the “Market Regulation” unit to the Communications Regulation Commission, joined the discussion presenting a study on Internet subscribers based on the reports of 93 percent of the internet survice providers in the clountry. According to the study, by the end of 2009, there were about 950,000 Internet subscribers in Bulgaria. Over half of the subscribers use LAN technologies, around 30 percent use ADSL, 12 percent access Internet via cable modem, and only 1 percent use narrowband access.
Mr. Alexander Ognyanov, Deputy Director of the National Health Insurance Fund, noted the recent involvement of the fund in a number of projects related to the implementation of ICTs. Yet, these projects were largely uncoordinated and there was no single strategic vision. Thus, a working group was created to evaluate and propose a long-term planning, coordination, and development mechanisms for individual IT projects. An important step in this direction is changing the National Health Insurance Fund’s procedures for data collection and information sharing. The abovementioned changes made data collection and the exchange of information centralized, no longer passing through regional offices (i.e. Regional Health Insurance Funds).
Mr. Julian Nikolov, Director of the Economic Policy Directorate at the Ministry of Economy, Energy and Tourism, confirmed the importance of R&D reporting and data accuracy for the process of economic policy planning. Even though Bulgaria ranks last in the European Union in terms of innovation, there are a number of highly innovative firms with permanent R&D activities in the country. Mr. Nikolov stated that the research and expert evaluations of the ARC Fund revealed clear discrepancies between the official assessments and the Bulgarian reality, including the underestimations of R&D in the ICT sector. Using ARC Fund findings, the ministry has set an ambitious goal of reaching 1.4 to 2.0 percent of GDP for R&D expenditures in 2015. This goal has already been approved by the Council of Ministers and is included in the formulation of national policies in line with the Europe 2020 priorities. Yet, the assessment of some political decisions suggests that innovation is not universally accepted as a national priority. The latter becomes evident from this year’s budget for the National Innovation Fund: there were BGN 4 million allocated to the fund, yet it has accrued outstanding liabilities for projects of about BGN 7 million. Thus, the Ministry is committed to creating a Law on Innovations tasked, among other things, with establishing new tools for financing innovations. According to Mr. Nikolov, ICTs are an absolute priority, along with the development of renewable energy technologies, and health related technologies. According to the economic analysis of the country, used by the ministry for economic planning purposes, the Bulgarian ICT sector has a higher value added than the EU average. Thus, prioritizing this sector in the overall economic policy is a step in the right direction.
Mr. Antony Slavinski, Chairman of the Association of Telecommunications, stated that, to date, most sectoral policies for innovation and ICT have been developed and implemented without proper analysis. Thus, in many cases, these policies provided a disincentive instead of promoting development. According to Mr. Slavinski, there are a few major reasons for Bulgaria’s notable progress in providing broadband Internet. First, for about a decade, no sectoral policy in this area existed, enabling suppliers to operate freely. In addition, the market (based on the market behavior of traditional telecom operator – BTC) has given impetus to the development of alternative suppliers. Moreover, the limited interest of the European Commission in this area of development in Bulgaria has enabled the development of LAN technologies instead of merely prioritizing DSL technologies.
Mr. Slavinski pointed to two particularly promising future directions in the development of telecommunications in the country: the development of next generation internet connectivity (i.e. over 10 or 20 Mbps), and the efficient use of the spectrum following the introduction of advanced technological solutions.
Prof. Roumen Nikolov, Head of Department at the University of Library Studies and Information Technology, outlined some European initiatives for ICT development based on research and measurable indicators for policy implementation. According to Prof. Nikolov, the Seventh Framework Program highlights the lack of effective tools for planning and monitoring of policy implementation, including in the ICT sector. Yet, ICTs can aid the creation of such instruments, thus, the Commission has already funded several projects in this direction.
Mr. Georgi Apostolov, Program coordinator at the ARC Fund, presented the Safer Internet Center’s work and emphasized the importance of coordination and collaboration between NGOs, Internet users, and public authorities in safeguarding children’s security in the global network.
Agenda (in Bulgarian only / Adobe PDF, 160 KB)
Draft of the e-Governance Strategy, presentation by Mr. Parvan Rusinov, Ministry of Transport, Information Technologies and Communications (in Bulgarian only / Adobe PDF, 238 KB)
Rethinking the indicators on ICT policies, presentation by Mr. Todor Galev, ARC Fund (in Bulgarian only / Adobe PDF, 324 KB)
R&D, innovations and information society, presentation by Ms. Milena Kovchazova, National Statistical Institute (in Bulgarian only / Adobe PDF, 146 KB)
Sectoral policies in the ICT field, presentation by Mr. Antony Slavinski, Association Telecommunications (in Bulgarian only / Adobe PDF, 163 КB)
European initiatives for ICT development through research-based policies, presentation by Mr. Rumen Nikolov, University of Library Studies and Information Technology (in Bulgarian only / Adobe PDF, 2.9 МB)
