The COVID-19 pandemic proved once more the importance of accelerating digital transformation at the global and national levels. This is obvious, especially in conditions of mobility restrictions adopted to reduce the risk of getting infected with the novel coronavirus. Several digital services became immediately in high demand: remote learning, e-trade, e-health, etc. Although Moldova has a developed digital infrastructure (the country’s territory coverage with 4G is 98%), well-placed e-Gov services, an ICT sector (Information and Communication Technology) with accelerated development (7% contribution to the Gross Domestic Product – GDP), the COVID-19 pandemic emphasizes the need of accelerating digital transformation in the country.
Hence, according to the Social and Economic Impact Assessment of COVID-19 in the Republic of Moldova, developed by UNDP Moldova, about 150 thousand pupils had no access to education during the lockdown period, because of lack of necessary equipment, knowledge or connection to Internet among pupils or teaching staff; not being prepared to sell online, many companies (especially small and medium enterprises) ceased their activity, inducing an economic downturn of -7% of GDP in 2020; many of employees from the public system (local and central public authorities) had to be physically present at work, being exposed to the risk of getting infected, because of the deficient operation of some digital systems etc.
Nevertheless, the Republic of Moldova is a country with all the necessary ingredients for a rapid and impactful digital transformation: advanced infrastructure, developed ICT private sector, authorities’ commitment focused on digital transformation, as well as a well-prepared society for accepting and using digitalization.
As the Digital Moldova 2020 Strategy has expired, it is necessary to have an updated vision in this area in Moldova. Accelerating digital transformation without an inclusive, well-balanced, and visionary strategy, which would have a whole-of-society approach (government, civil society, academia, private sector, development partners, etc.) could diminish the expected result. Therefore, UNDP Moldova will support the Government’s effort to formulate the strategic vision on digital transformation.
As a first concrete step undertaken by UNDP in this context was the Digital Readiness Assessment in Moldova , the results of which were presented during the first dialogue of the Government with the development partners, supported by UNDP Moldova. The assessment pointed out the current challenges in the area and provided the benchmarks for creating a new national digital strategy.
Subsequently, UNDP Moldova together with the International Telecommunication Union (ITU) developed a compact on digital transformation of Moldova. Both documents will serve as basis for drafting the new Strategy on Digital Transformation of Moldova.
The future strategy should take into consideration the major opportunities related to digital transformation, especially in the following areas: infrastructure, people, government, business community and whole-of-society.
1. Infrastructure: the foundation of digital transformation
According to the data for 2020, 98% of the territory of the Republic of Moldova has 4G coverage, and 58.8 out of 100 inhabitants have mobile-broadband subscriptions, while other 17.8 out of 100 inhabitants have fixed broadband subscriptions. The price for an Internet subscription in Moldova is relatively affordable, being under the European average. At the same time, this cost exceeds insignificantly the threshold of 2% of the gross national income (GNI) – the maximum cost for broadband Internet, which guarantees services’ affordability, established by the UN Committee.
The ITU’s Global Cybersecurity Index ranks Moldova on the 33rd place in Europe and the 63rd place in the world. The country’s joining in 2009 of the Convention on Cybercrime of the Council of Europe and adoption of the National Cyber Security Program for 2016-2020 have established the legislative parameters for a safer digital environment. The next step towards cyber resilience was the adoption of the Information Security Strategy of the Republic of Moldova for 2019-2024, which transposes the NIS Directive (the acronym for Network and Information Security, but also the short name of the first European Directive on Cyber Security) into the national legislation and creates an action framework against cyber risks.
Recommendations in this regard:
- Identifying in partnership with the key operators and civil society the necessary incentives for ensuring broadband Internet connectivity for the remote localities (to ensure better last-mile delivery). Determining current priorities: speed (5G) versus access.
- Promoting public programs focused on ensuring access to Internet for all, such as access to Wi-Fi connection in public space and support to schools for ensuring children from vulnerable families with computers.
2. People: people-centered digital transformation
A number of initiatives already support mainstreaming digital tools at all levels of the educational system, such as: Tekwill in every school, Future Classroom initiative, National Program for Digital Literacy among Teaching Staff, as well as the online educational platforms studii.md and invat.online etc. Although 18 higher education institutions provide training in IT area, there is a deficit of personnel in this area, partially explained by the brain-drain among youth. Another imbalance would be the weak representation of girls and women in the sector: only 4.6% of girls go for education in STEM areas (science, technology, engineering, and mathematics) and only 19% of employees in the digital area are women. Such programs as GirlsGoIT aspire to encourage and help girls to get involved in IT activities. It is imperative to take measures which would ensure a gender equality balance in all the training programs.
Moldova has ratified the Convention on the Rights of Persons with Disabilities in September 2010 and adopted the Law No. 60/2012 on social inclusion of people with disabilities, while the Audiovisual Media Services Code of the Republic of Moldova had transposed the European Audiovisual Media Services Directive. Nevertheless, the implementation of the legislative provisions should be improved.
Recommendations in this regard:
- Promoting universal design of ICT products and services.
- Facilitating involvement and participation of people with disabilities and ensuring ICT accessibility in education.
- Ensuring increased online security – a reviewed legal framework is needed to ensure personal digital data confidentiality, especially in case of minors.
- Encouraging STEM careers by adjusting policies and connecting to public infrastructure works.
- Performing additional research on digital transformation impact on vulnerable segments of population.
- Promoting entrepreneurship initiatives among youth, which would facilitate the dialogue between startups and ensure visibility for business success stories in the country.
- Updating the legislative framework to comply with international standards on accessibility and online safety.
3. Government: centre of digital transformation
The process of digital transformation at the level of governmental institutions started in 2006, when the e-Governance Concept was approved. Subsequently, the Strategic Program for Technological Modernization of the Government for 2011-2016 set forth the framework for the future e-Transformation process, establishing the essential elements of this process – the e-Transformation subdivisions in central public administration authorities. The following were launched: the Governmental Data Portal “date.gov.md” (2011), mobile digital signature (2012), M-Cloud (2012), MPass (2013), MPay (2013), MSign (2013), e-Visa (2014), MConnect (2014), etc. All these projects and initiatives, led by the government and supported by the development partners, have led to creating a rather well-developed national e-Governance infrastructure.
The National Program for Modernization of Governmental Services 2014-2016, the Action Plan for Public Services’ Modernization Reform for 2017-2021 and the Modernization of Government Services Project for 2018-2023 have also contributed substantially to eliminating the old format of public services’ provision, ensuring their modernization and consolidation, improving their quality level for satisfying citizens’ expectations. For instance, the national portal of electronic services “servicii.gov.md” currently provides Single-Sign-On access to 178 electronic services and information on 649 public services. The payment system MPay integrates 86 public services and registered over 20 million transactions to date.
Recommendations in this regard:
- Extending public services on all dimensions in digital format, reducing the need of physical interaction between public servants and final beneficiaries.
- Digitalizing judicial services in a comprehensive manner.
- Developing upskilling programs in IT area and increasing general competences of public servants.
- Updating rules and policies on public data, including the standards for publishing such data.
4. Business community (private sector): sector-centered digital transformation
ICT became a priority sector for the national economy (about 7% of GDP). Besides the favorable fiscal regime, another incentivizing method would be encouraging this sector to generate digital solutions for non-IT sectors, as well as for accelerating the digitalization of public services. All the economic sectors should be encouraged to be open to the digitalization process, especially the agricultural and Small and Medium Enterprises (SMEs) sectors, as they are key areas for the Republic of Moldova’s economy. Hence, according to the data from the last three years, the agricultural sector generates 10-12% of GDP and employs 1/3 of the country’s population. It is a real challenge to channel this area towards sustainable development, but this is essential for the economic growth of the country. The following initiatives can be mentioned among the previous governmental initiatives meant for the transformation of the sector: Strategic Program for Modernizing Policies on Technological Development in Agro-industrial Sector (e-Agriculture), approved in 2013; Digital Map of Agriculture, launched in 2015; and a more recent activity – development of the National Wine & Vine Register, as well as a few information systems for monitoring and record-keeping.
The SME sector is also of strategic importance for the national economy. In 2019, it represented about 98.6% of the total number of enterprises, generating 39.5% of sale revenues and employing 61.6% of private sector employees. However, less than 17% of the SMEs have integrated successfully digital technologies in their activity, hence representing a huge unexplored potential and pointing out the urgent need for digital transformation of this sector.
The Strategy for Development of SME sector for 2012-2020 was followed by the Program for supporting business with high potential for growth and internationalization, approved in 2020. The Government used these documents as basis for enforcing a wide range of projects meant to support SMEs, such as: Business Efficient Management Program, “PARE 1+1” Program, Women in Business Program, Start for Youth etc. Despite all these efforts, a lot of barriers and challenges remain to be overcome.
Recommendations in this regard:
- Performing more studies to identify the barriers faced by small and medium enterprises and developing initiatives to support their digitalization.
- Adopting, encouraging, and developing digital tools for SMEs, as well as of other important sectors for economy.
- Developing initiatives that promote generation of digital solutions, contests for start-ups and initiatives of living-lab type, which would increase the visibility of the ICT sector and development of the economic sector in general.
- Generating and developing different specific actions for increasing population confidence in digital solutions, which would include enhancing consumers’ protection and increasing consumers’ trust for e-Commerce system.
5. Whole-of-society: developing an innovative and transformational ecosystem
Moldova is well prepared for promoting digital transformation at the whole o society level. The country is developing a robust ICT-centered innovation ecosystem. There are well-defined directions based on which these efforts may be enhanced. Nevertheless, the Global Innovation Index (2020) ranks our country on the 59th place out of 131 countries, and the Global Entrepreneurship Index (2019) ranks Moldova on the 94th place out of 137 countries.
Digital Moldova 2020 is the country’s main strategy related to the ICT-centered innovation ecosystem, but it has expired. The successful implementation of this program had a positive impact on Moldova’s innovation ecosystem. However, a good part of the existing “soft” infrastructure, such as Tekwill, Artcor, Dreamups, XY Partners, Generator Hub, iHub, FabLab and Digital Park, is concentrated in Chisinau. This list is continuously evolving, for instance MEDIACOR is another Hub which will be launched soon. Two regional strategic initiatives are getting developed outside the capital city: the Regional Center for Innovation and Technologic Transfer in Balti and the Regional Center for Innovation and Technology in Cahul. There are several FabLabs under the Novateca libraries’ network and a network of regional incubators, which could be transformed into regional innovation centers.
Hence, a new strategy for comprehensive digital transformation is necessary for the next 7-10 years, which would bring together the Government, ICT sector, civil society, academia, and others.
Recommendations in this regard:
- Performing an analysis of gaps in the current legislative and regulatory frameworks related to digital transformation of Moldova.
- Developing a regulatory framework which would foster the digital transformation progress of the country.
UNDP’s recommendations for each of these five pillars are:
- Infrastructure. Implementation of the 5G network as a national priority, which needs development of the regulatory framework and relevant standards. It is necessary to conduct a study on expanding (and securing) remote access to high-speed Internet from home and removing cost barriers to connectivity, based on an inter-ministerial plan for such infrastructure’s development.
- Citizens. Citizens are the beneficiaries, but also the main pillar of the digital transformation process. They should be directly engaged in drafting the national strategy for digital competences’ development. At the same time, it is needed to develop the national strategy on protection of minors when accessing online services or platforms. To identify the systemic gaps, it is recommended to conduct a national evaluation of digital accessibility. Additionally, it is important to tackle the weaknesses in the digital area, highlighted by the pandemic crisis; to explore opportunities for digital transformation’s promotion, by encouraging and investing in STEM education, promoting entrepreneurship, supporting vulnerable groups, and ensuring access via mobile devices.
- Government. The Government is a vital pillar for accelerating digital transformation in Moldova, especially now, when a Deputy Prime Minister for Digitalization was appointed. Hence, it is recommended to draft a national strategy for Moldova’s digital transformation for the next 7-10 years.
- Business community. It is necessary to create platforms for engaging local ICT sector (7% of the GDP) in the digital transformation of the society; to encourage ICT sector to develop digital solutions for key non-ICT sectors, such as agriculture and SMEs. At the same time, it is important to identify the barriers faced by companies from these sectors and to develop national support programs to harness their potential in adopting inclusive digital technologies, as well as to simplify e-commerce procedures.
- Whole-of-society. It is necessary to develop inter-sector opportunities, which directly and indirectly will increase the innovation level and will boost the entire society’s digitalization. It is also necessary to develop a national strategy for digital transformation focused on ICT sector’s involvement in the process, hence improving the innovation ecosystem of the society.
UNDP Moldova will support the Government of the Republic of Moldova in developing the National Strategy on Digital Transformation for the next 7-10 years (potentially up to 2030), in line with the commitments assumed under the Association Agreement signed by the Republic of Moldova with the European Union. This will contribute to fostering transformational changes related to the organizational and innovational culture in the public and private sectors, involving all the institutions (central and local public authorities, civil society, academia, development partners, etc.) in accelerated fulfillment of Government’s priorities. This process will also ensure support for digitalization of the Republic of Moldova, which inevitably will contribute to improving the governance process by increasing its efficiency and efficacy, transparency and public access to governmental information and bettering public service provision to citizens. Besides, it is very important for the digital transformation acceleration process, starting with development of the Digital Strategy for the next 7-10 years, to include and to encourage the participatory spirit of the ICT sector (which is rapidly developing) and to prioritize the process of developing the digital skills of the population, especially of the vulnerable one.
Depending on the priorities identified during the development of the new Digital Strategy of Moldova for the next 7-10 years, the UNDP Programme for Accelerating Digital Transformation will get aligned to the respective needs. The UNDP Programme will support various innovative interventions for increasing digital skills among the public sector employees, as well as for the general population, especially the vulnerable groups of the population. UNDP will include its network of partners in this process, to cover the entire country (including the Transnistrian region), and various areas of assistance (economy, education, health, central and local governance, etc.).
UNDP Moldova will also cooperate and collaborate with other innovative networks, such as “Future Classroom” and “Tekwill in every school” networks (based on STEM education system or the one focused on increasing ICT skills), “Novateca” libraries’ network or recently launched by UNDP Moldova in collaboration with eGov Agency network of media ambassadors for digital transformation etc. The final aim is to create a comprehensive national network of Agents of Change for the digital transformation of society at the national and local levels. Besides, it is obvious that the ICT sector should be encouraged to play an active role in Moldova’s digital transformation process. This will lead directly to using the innovations from the ICT sector in the transformation of the Moldovan society and, indirectly, to fostering the development of the given sector and that of the national economy in general.
Another priority of the UNDP Programme for Accelerating Digital Transformation is to develop reliable competences with immediate effect of assessing the impact generated by program interventions, and to create a smart and innovative platform for data processing. This would allow using state-of-the-art methods for the most efficient implementation of the program.