Interview with Ana Chirita - Strategic Projects Director at Moldovan Association of ICT Companies

In our last interview, we discovered the founders of Sonder Agency from Berlin, Germany. Besides being two very promising and talented specialists in verbal and visual branding they turned out to be a pretty inspiring couple. In case you missed our talk, you should definitely give it a read here.

This week we are moving to Moldova - a sunny country in Eastern Europe, bordered by Romania in the west and Ukraine in the East. A land that is rather known for its top wines and strong agriculture rather than IT.

But things are changing and this little European country is getting strong, courageous and proven steps in the IT and technology industries. Our founder, Marcel Sobieski, had an open talk with Ana Chirita, who is the Strategic Projects Director at the Moldovan Association of ICT Companies.

To start with, please tell us about yourself. Your childhood, education, professional formation and how did you come to the current role?

As a child, I have been extremely passionate about mathematics, physics, chemistry, biology, and everything that relates to the sciences. Math was particularly my passion! It’s still fascinating to me! And of course, this naïve passion for science that at that moment was like climbing a mountain for a kid came with multiple awards in mathematics, physics, and chemistry, including a scholarship within the American program FLEX offered by the  United States Government. So basically, during the 9th grade I was leaving my own way of the American dream. I lived one whole year in an American host family and went to an American School. The school I went to has nominated me as the best student in Advanced Physics which was a big surprise for me. It was WOW! Like one of the Moldovan kids being appreciated in an American school, educated in total very different educational system. 

When back, I decided to graduate from school earlier and applied for the IT Faculty at one of the leading Moldovan Universities – Technical University of Moldova. During my university years, served as a President of the Students Alliance of Moldova- an organization encouraging students' participation in auto governance models within 16 universities at that time. Considering the context of 2009, when the IT sector was an emergent one and new voices, new visions,s and new approaches were very important to push up the development of the sector, I submitted my CV for the position of Executive Director of ATIC. The next week I was in an interview with 5 Board members who decided I can probably do the job. 

Looking into the past,  I have not been aware that I can do it at that time.  But, it’s been 13 years since then. During these 13 years, my job consisted of positioning ATIC as a leader umbrella organization for ICT where it serves its members on one hand in relation to doing business, enabling the business environment, and dialogue with the Government, but also finds solutions towards growing the sector to make it more competitive and more attractive. There is a series of Strategic to the industry and even to the country projects that we have developed during these 13 years: Tekwill and Startup City Cahul being among some of the most notorious, but also challenging, of course in a positive way, in terms of vision, commitment and implementation.

You mentioned ATIC. What is that? What was and is its purpose? How does it serve today?

THE MOLDOVAN ASSOCIATION OF ICT COMPANIES (“ATIC”) is a business Organization uniting 94 companies and serving as an umbrella organization gathering over 9000 employees.

Being established in 2006, ATIC is the action-leading association and the voice of the Moldovan ICT industry that promotes the development of the ICT sector in the Republic of Moldova through viable partnerships between companies, similar organizations, government, state institutions and international organizations. The association was founded to represent the industry on different policy and legislative issues and to facilitate the exchange of best practices between members. ATIC's mission is to protect and promote the Association members’ interests as well as facilitate a more favorable ICT business climate.

Over the years, ATIC has grown such as it acts as the leading voice on all business exchange and government committees, as well as has developed a projects strategic arm aiming to foster innovation, entrepreneurial growth, the share of knowledge and expertise, as well as contribute directly to Moldova’s human capital development, which is one of the most stringent needs of the sector nowadays.

Among some of its projects, we should mention Tekwill. It is where people, community, ideas, resources, science, and industry meet to identify, facilitate, and enhance excellence in information technology. Driving the Moldovan ecosystem, as a leading connecter and networking facilitator, organizing and supporting local and regional tech-related events (deploying relevant ICT educational content and entrepreneurship activities in the regions Chișinău, Bălți, Comrat).

A similar project is being implemented in Cahul: EU4Moldova: Startup City Cahul aiming to contribute to the regional economic potential through entrepreneurship and a better-prepared workforce.

All of the above response to the vision of ATIC members on how the sector should grow up to 1 billion USD by 2024.

According to the National Bank of Moldova, the ICT sector in Moldova represents 7,6% of the GDP. This is a serious announcement. Going a bit into more detail, how comes? What is done to facilitate ICT development in Moldova? Moldova IT Park. 

Indeed, the ICT sector of Moldova currently represents 7.6% of the GDP. However, the most interesting part is when we look at the IT component that grew from less than 1% to 4,1% in 2021 reaching a total of $359M in exports in 2021 only. For the last several years, the C (communication) component has been stable, while IT has experienced excellent growth. The tremendous growth is the result of multiple consistent efforts to create a favorable business environment, invest in the human capital of Moldova and increase the visibility and attractiveness of the industry.

The first attempts to achieve these results relate to recognizing the ICT industry as a priority under the Digital Moldova 2020 strategy back in 2012. The second one was to develop a strategy for the development of the IT Sector back in 2014 where a new attractive fiscal regime would be put in place for Moldova. The whole idea was to create a better regime than the neighboring countries so that Moldova does have a significant competitive advantage in front of the other countries. It took 4 years of negotiation until the current Moldova Innovation Technology Park (by then it was Moldova IT Park) has been established. Since 2018, Moldova has benefited from a unique unprecedented reduction in the tax burden thanks to the introduction of a single tax of 7% applied on the sales from the revenue. The regime came with the facilitation of immigration documents for foreign employees in IT, and a decrease in bureaucratic barriers. The park is a virtual one, therefore the digital presence is again another advantage that it offers. In 2018, 15 ATIC member companies have signed the documents for the park creation, while the Government facilitated its operation. Today there are more than 1200 residents with more than 15,000 employees part of the Park.

Besides the fiscal regime, it is always important not to disregard the other aspects. The better the regime is, the more competition arises. This puts a great burden on employment possibilities.

To address this issue, ATIC has contributed to the development of Tekwill aiming to address the lack of skilled labor due to the country’s high rate of emigration and the rapid development of global technology and the need for adaptation. Additionally, the education system has not provided adequate training to support the private sector’s workforce needs. Moldova is an emerging market with a weak entrepreneurial ecosystem that limits the creative growth of product development companies within its growing tech sector. 

Tekwill utilizes a public-private partnership model to create synergies with the Moldovan Government, academia, donors, multinational companies (Oracle, IBM, Microsoft, PECB, etc.) and the local private sector. This project is implemented by the National Association of ICT Companies (ATIC) in partnership with leading national universities and has been developed in two phases. The first phase has created a place where people connect with ideas, resources, science, and industry to enhance excellence in IT. The second phase envisions the expansion of the programs nationwide by adapting the Chisinau-based model throughout Moldova.

By establishing the Tekwill Center in Chisinau the project has developed revolutionary programs by providing quality-driven content for all levels of education, as well as enhancing the startup ecosystem through activities directed towards building Moldova’s workforce in tech. The USAID Tekwill Project has provided world-class educational and entrepreneurship programs to more than 185000 beneficiaries, of which 43.3% were girls and women. 

Moldova has two strong neighbours in the IT world (Romania and Ukraine). Is this a blessing or a curse? Please elaborate.

By having strong neighbors in the IT world, Moldova is set to think about how to become more competitive, and more niched in the various services it uses. With a pool of people much lower than both Romania and Ukraine, it has to find its way through and invest in a good image, a better-skilled labor force, and amazing fiscal regimes to be able to attract. Also, Moldova needs to seek cooperation versus competition between the two and use good practices in this sense. So, being near strong competitors might lead you to want to reach the same level or even the next one.

I am curious, is the IT sector in Moldova focused more on production, innovation, and startups, or more as an extension of the big multinationals? What is your observation? And why?

Moldova still is an 80% outsourcing market due to the specifics of the multinational companies present in Moldova. This is how usually in non-US countries the IT develops:) It all starts with services, but where better business culture is nurtured and basically a new generation of youngsters, beautiful minds choose a more competitive, and more attractive career – the IT one. Innovation and production have a place in Moldova as well. In the last several years, we have witnessed an increase in startups in Moldova. Moreover, within our programs, we have directly contributed to the growth of the ecosystem through acceleration programs, entrepreneurial education, international connections, and lately creation of a dedicated structure supporting the appearance and growth of the startups. The product development companies require additional support to find new markets and be able to attract investments that would allow Moldova to have a completely different perspective – move from an outsourcing model towards a product model.

Would you and the local institutions consider any change or consolidation in this dynamic? 

Moldova is still a young ecosystem. The Tech ecosystem is young as well and at an incipient phase. To be able to consolidate the dynamic there are several important actions that need/could happen:

1. There is a set of Moldovan companies that have wonderful services and products. What they need is Government support to promote them outside. This is what other countries such as Estonia and Armenia have done – they promote local products and companies and support their expansion outside the countries.

2. There is a need to create a balance between association with big brands/names that influence local cultures, but also support the creation of local ones and support their expansion. This relates not only to companies but also to ecosystem players. We cannot grow only in a local market. All need to seek opportunities bringing them towards regional/global presence.

3. There is a need for knowledge in terms of investments. If we want to be part of global investments, we need to learn- how to do this kind of business, how to evaluate a company/startup, how to reach investors, how to close deal flows, and so on.

4. To succeed- we need to invest in our people. All the programs need to be strategic and consistent, without sporadic quick wins put as a priority.

What are the real challenges Moldova is faced with in 2020-2024? Lack of education, the war, economic stagnation, people exodus, or anything else?

Moldova faces multiple challenges overall. Starting with the fact that Moldova is a poor country, there is a continuous brain drain where all our brightest minds leave the country right after school, there is a low trust towards the country itself. This happens mostly because many of them want better services (social, education, work-related) or they want to be associated with successful and proud of themselves countries. We need to invest and shift the idea towards where we are proud of being Moldovans, promoting Moldovan businesses, and promoting the skills and excellence that we are equipped with. It would be nice if we learn to give back to the country even if we leave and support the economic growth, the educational sector, and the people in the country to build trust in a better future.

The war at our door has shifted multiple priorities, and security becomes even a more stringent need to the people of this country than anything else. Difficult times sometimes might stimulate the society. In Israel, for example, a lot of startup have been created to cover the needs and to provide services for the army. My point is the fact that IT creativity sometimes goes beyond difficult circumstances to respond to the on going changes.

Are there any improvements or a strategy to avoid that?

There are multiple strategies being developed in Moldova that strive to create well-being for the people of the country. One of them is Moldova 2030 strategy focusing on skills, inclusion, economic growth, health, transparent and well-functioning state institutions etc. There are dedicated sector strategies in work such as Education 2030 strategy and Digital Transformation Strategy which are important for our sector in the first run, but also for Moldova as a whole.  We have seen a shift of views and more openness on the side of the international development partners to invest and support Moldova to be part of the European family. Still, from a strategy toward results, it is important to be able to consolidate all stakeholders' commitment and contribution. There is a need for clear action plans and excellent execution to be able to succeed.

Being realistic, yet courageous, what is your bet on Moldova's IT sector for 2022-2026? How do you see its future?

My bet is that the Moldovan ICT Sector has not reached yet its full potential. It will double by 2026 in volume if it continues to invest into human capital, keep the favorable fiscal environment, develop a next digital strategy and of course invest into investment/entrepreneurship ecosystem. 

The next ‘digital strategy’ needs to extend the Government's focus beyond the four areas of the ‘Digital Moldova 2020’ to ensure digital innovation and the development of a resilient digital economy, targeting a correlation with the EU’s ‘2030 Digital Compass’.

It needs to further advance the development of the IT Park regime to offer more predictability and durability and to address residents’ needs in improved access to funding, the attraction of qualified IT professionals and investors from abroad, and better social security for their employees.

Top priority measures for the next ‘’digital strategy’’, in the short run, stem from the vital necessity of facilitating remote work, digitalization of public services and e-commerce, and telemedicine, in a world hit by the ongoing COVID-19 pandemic. 

I also think, that in 4 years we will see a qualitative shift from outsourcing to more product development, where the IT sector will focus on more strategic and niched sectors/areas. I am sure the next big global name will come out of Moldova by 2026:)

Why foreign companies should use the momentum to open branches or partnerships with Moldovan IT companies? If they should ever do, of course!

Moldova offers a unique combination of key ingredients to make it attractive.  Worth to mention the favorable tech business environment with the innovative 7% single tax provided via Moldova Innovation Technology Park that helps keep firm and labor costs competitive (given that globally the tech industry is facing one of the most acute talent gaps and hence labor costs keep going up). We have undertaken a recent benchmarking analysis with Moldova IT Park (to feed into the IT Park law amendments) and concluded that Moldova still retains cost competitiveness, with the ‘cost of doing IT business’ being one of the lowest in the region (lower than in Romania, Poland; but higher than in Georgia).

 The people – Moldova has a small tech talent pool but is highly skilled (IDC highlighted the ability to work in a multi-cultural environment, professional attitude focusing on the quality of the finished code, and open and friendly customer interaction). In the IT sector, the quality of the tech workforce is a key differentiator and comparative advantage. Note that Moldova’s IT service exports per tech employee have tripled since 2015 (from $6,300 to nearly $22,967 in 2021), meaning that the value added and productivity in the local IT -the sector is growing (more innovative firms are entering the market that is not just seeking low-cost labor but talent, as well as new technologies and technology transfer such as (R&D, design engineering, teaching) catalyzing exports to higher-value-added verticals).

Mature companies- there are companies that serve a wide range of needs and have excellent expertise, including their own products and niched services that can serve as a good base for collaboration for multinationals, Governments, and various industries who are looking for high-quality solutions. We are talking about the availability of eGov expertise or Fintech. 

Enough about policies and business. If given the chance, which personality, dead or alive, would you have dinner? Please elaborate.

Definitely, Steve Jobs- it’s all about vision, ambition, and consistency and how to grow a culture, not just a company.

If you would meet next week Jeff Bezos, what would you ask or tell him?

I would try using the momentum to tell him that the next Amazon Office should definitely open in Moldova. A Spheres office in the heart of Moldova would make sense to connect East and West:) I would ask if he dared to invest in a huge opportunity for a generation of future skilled specialists into the most „Tekwill in every school” the most revolutionary educational project developed in Moldova: Tekwill in Every School. It is designed with the goal to offer Moldovan students equal educational opportunities driven by IT Sector Market Needs, but the model is suitable for all other developing countries.

„Tekwill in every school” is a comprehensive program of extracurricular courses, dedicated to pupils aged between 13 and 19 years old. The project allows free access to innovative digital resources, offering the necessary knowledge and skills, to better prepare the beneficiaries for the professions of the future.

„Tekwill in every school” aims to transform education in the Republic of Moldova, both through the development of a well-prepared young generation for the professions of the future and through introducing new teaching methods in the learning process within the educational institutions: blended learning and the flipped classroom. In the long term, the project has the mission to harness the country's human capital and raise a generation of people who would create products and services at home, in Moldova, that respond to national and global socio-economic challenges and at the same time provide students with the skills needed for professions sought after on the labor market. 

And of course, I would definitely ask about his time management- how does he manage to sleep well and manage a global giant:)

Your favourite movie and the car you drive?

I don’t have one, I just like quality video movies and content that approach social issues and had a meaning behind. I am the mother of 3 kids and sometimes free time it’s a luxury, and of course I preffer to have quality time in the family instead of watching pointless content.  

I am driving a sports car in the “Superstar car” game when I used to have some fun with my kids

Please send a message or advice to our readers, future investors, and regional competitors.

First: Keep an eye on Moldova! Get a plane ticket and visit this country. According to Lonely Planet: You would find here “ unspoiled countryside and superb wine tours. As one of Europe’s least visited countries, Moldova retains a measure of roads-less-traveled charm. But that’s changing quickly as budget flights from Western Europe take off.”

Second: Moldova is expecting another 10,000-20,000 Specialists in the next 5-7 years due to its investments in Human Capital. Grown up from the Tek will courses, we see a high potential of an inflow of specialists in AI, Mobile, Data Science, Programming, and Creative Industries.

Third: Invest and Partner with Moldovan companies and startups. They will change the world:)

Did this interview raise your curiosity about Moldova? The interest to invest in its intellectual resources, hiring a few specialists or relocating your team? The decision and conclusion are up to you. It is definitely a place to consider for doing business from many standpoints that we touched on above. Moreover, besides business, it is also a hidden gem for any seasoned traveler, only 1:30 hours flight from Berlin or 2:30 hours from London.

Thanks for reading and if you have an interesting story that people deserve to know about - don't be shy and reach out to us and we will take it from there.