News

Executive Summary

The government is planning - in the framework of the 2007-2013 strategy ‘Knowledge-Based Estonia'- an additional investment of some 100 million kroons towards preferential development of the ICT sector during the next 5 years. This is a rather modest figure against the background of current investments geared towards ICT implementation and product development in Estonia. The Development Fund is suggesting - taking into account the outcome of EST_IT@2018 outcomes and the above-mentioned resource constraints - that these funds should be channelled into education, which is being viewed as the cornerstone of Estonia's ICT success.

Estonia needs a significantly higher number of good ICT specialists. For the purpose of raising Estonia's ICT to a strong international level, investments must be geared towards the following activities:

• attracting at least 5-6 reputable foreign professors to Estonia and providing them with a requisite working environment;
• launching Master's level technology and business management programmes with a strong focus on ICT, which would be targeted at ICT specialists, middle managers or heads of  small companies.

In 2009, the Development Fund is initiating the development of long-term roadmaps for ICT implementation in six focus areas (education, health care, manufacturing, energy, financial services and ICT security systems). In order to draw up respective roadmaps, the experts concerned will undertake a more in-depth analysis of the time required for the implementation of different ICT solutions, the required resources and opportunities for finding such funds.

Most of the groundbreaking ICT innovations are made in countries where the number of inhabitants is many times bigger than in Estonia. These countries simply have more researchers and engineers committed to ICT development. Therefore, Estonia needs a good understanding of what is happening on the frontline of ICT development. The more Estonia manages to keep pace with the leading IT countries as regards the early introduction of new ICT base technologies, the more effective and competitive Estonia's own ICT solutions will be both domestically and internationally.

A prerequisite for enhancing the competitiveness of Estonia's higher education in the ICT area is bringing at least 5-6 strong foreign professors to Estonia.

Estonia lacks more than a thousand ICT specialists. The very high number of first-year university drop-outs indicates that talented young people do not find the higher education in ICT currently provided in Estonia sufficiently attractive. Meanwhile, by 2015 the number of students finishing secondary school will dropby 50% from the respective level in 2003. The sharp decline in the number of students will in turn make it more difficult to maintain the level of higher education. Hence Estonia has to raise the quality of higher education in ICT while increasing the supply of ICT labour.

In the short-term, the only possibility for Estonia's ICT sector is to import specialists. In the medium to long-term, we urgently have to enhance the quality of higher education in ICT so as to take it onto a strong international level.

For the purpose of fast-tracking the internationalisation of Estonia's ICT education, at least 5-6 reputable foreign professors or Estonian computer scientists working abroad must be brought to Estonia at a time. This will make Estonia's ICT education significantly more competitive while enabling the ICT areas of competence significant for Estonia to be filled with strong specialists.

Which are the ICT areas where competencies need to be enhanced? According to the experts who participated in the Estonian ICT foresight project, the country's ICT capabilities fall behind in most areas compared to our needs.

The following are the ICT areas where we have fallen behind particularly badly compared to the desirable level: Services internet and Grid services, new base technologies in the contact areas of microelectronics and biotechnology and nanotechnologies, integration of communication systems and alternative theoretical foundations of ICT systems (cognitive systems, etc.).

Enhancing international business management skills in ICT companies.

The entrepreneurs who participated in EST_IT@2018 identified the limited number of specialists possessing international product development and sales skills as a significant bottleneck affecting the development of Estonia's ICT sector. Insufficient insights into foreign markets coupled with modest product development skills make investments into new products and services unduly risky for many Estonian ICT companies.

A quick solution to the problem would involve bringing in the development and marketing personnel that Estonia needs. But that would not solve the underlying shortcomings in Estonia's system of higher education. Therefore, the Development Fund suggests that Estonia's higher educational establishments should launch Master's level technology and business management programmes with a strong ICT focus targeted at technology specialists, middle managers or heads of small companies. Besides Estonia, in neighbouring countries there is also a demand for high-quality education provided with the involvement of foreign lecturers.

Drawing up ICT utilisation roadmaps in six focus areas: education, health care, manufacturing, energy, financial services and ICT security systems.

The ICT sector accounts for just a small part of the Estonian economy as well as of most developed countries economies. Nevertheless, its contribution to economic development is extensive. The benefits derived from ICT development primarily manifest themselves through productivity growth achieved through the smart application of ICT in different areas.

In order to apply ICT as effectively as possible, Estonia must focus on the areas where the country is about to face major social or economic challenges. Meanwhile, in the short-term, growth possibilities regarding exports of ICT solutions are most likely to emerge in the areas where Estonia has already managed to demonstrate solid ICT standards.

The experts who participated in the ICT foresight project highlighted the need to modernise Estonia's education and health care systems, increase manufacturing productivity and make the use of energy more efficient as the most significant social and economic challenges in the coming decade. As regards areas where Estonia's capabilities of applying ICT solutions are the best, the experts identified the use of ICT in financial services and the development of ICT security systems.

Meanwhile, according to the EST_IT@2018 expert survey, Estonia's domestic needs in essentially all the above-mentioned areas are quite in line with the expected market growth elsewhere in the world. This means that in all the six focus areas we have rather good prospects of introducing new ICT solutions first in Estonia before taking them to external markets.