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Bulgaria ranks low in the overall Digital Economy and Society Index (DESI) but a few highlights and a growing positive image of its ICT specialists indicate a potential for greatness.
Content:
- The weaknesses: Low adoption & education
- Strengths: Female ICT experts & AI strength
- Summary: A potential for big (digital) steps in the future
According to the DESI report (source: European Commission) Bulgaria ranks 26th (next to Greece) overall amongst all European countries. Although the digital status quo is below the European average in almost all categories of the report, there are clear indicators that the country is capable of a fast transformation and can use the global push towards more digital solutions as a stepping stone for its own digital emancipation.
The weaknesses: Low adoption & education
The general public all in all less digital skills than the European average with only 29% having basic skills compared to 56% EU-wide. Especially ICT training by enterprises for their employees could be more available since onyl 7% offer it compared to 20% EU-wide.
Additionally, Bulgaria does not have as many ICT specialists in its workforce as most other European countries. Only 3,3% work in the field. This is all the more surprising, since the ICT sector in Bulgaria has been growing in the last couple of years and the country itself has gained a reputation for its ICT services, especially when it comes to nearshore offerings.
But according to the report, the country faces a lack of specialists, even though ICT graduates are slightly above the European average. A possible reason could be that graduates will look for career opportunities in other countries and therefore leave the Bulgarian workforce.
The fact that few companies offer ICT training and therefore probably aren't as attractive to specialists who'd like to further educate themselves and grow their skills, is a likely additional factor for the lack of skilled employees.
Network coverage needs to be widened
Bulgarias 4G coverage is exceptional with 99,9% (compared to 99,7% EU-wide) but both fast broadband and high capacity network coverage are much lower than the European average. Compared to countries such as Portugal and Romania, which have a low usage but a high capacity network, Bulgaria needs to strengthen its network coverage to be competitive and to motivate people to use internet services, especially in rural areas where the coverage is low.
Since Bulgaria has started extensive programs to make hardware available to pupils and even teachers who can't afford it, the low uptake might also be due to high hardware costs. The internet services themselves are incredible low (Bulgaria ranks 5th overall for its affordable internet services) but hardware such as smartphones and computers can be a financial hurdle, especially if daily (work) life does not necessitate the use of the internet as much.
Few businesses are fully digital
Quite often, the use of digital services almost always depends on the amount and quality of the digital services which are being offered. On that account, Bulgaria unfortunately has a lot of catching up to do with the European average. Hardly any companies in Bulgaria are using digital services, platforms and channels. For example, only 10% have integrated social media (compared to 23% EU-wide). Only 8% use the cloud, compared to 26% EU-Wide. e-Invoices, online-selling cross-border as well as ecommerce solutions all are well below the average.
Likewise, the adoption and offer of digital public services is below when it comes to e-Government users (only every third citizen makes use of e-Government options compared to 64% EU-wide), availability of pre-filled forms and digital public services for citizens.
There is a high possibility, that Bulgaria has created a chicken-egg-problem when it comes to lack of services & lack of adoption of digital services. With many businesses but also public services offering insufficient digital functionalities, people will not see the need to be more digitally educated or use the internet as often which in turn will keep the numbers of digital users low which could be a reason why businesses and public services are not offering as many digital functionalities.
But let's take a look at the positive results of the DESI report because there is a lot of potential for a future growth.
Strengths: Female ICT experts & AI strength
Nearly every third ICT specialist in Bulgaria is female, which is well above the European average (28% vs. 19%). In fact, Bulgaria is - next to Romania, Greece, and Denmark - one of the most progressive European countries when it comes to women in the ICT sector, boasting high numbers of female specialists and offering attractive working conditions (source: emerging-europe.com).
Coupled with the fact that the number of ICT graduates is actually slightly higher in Bulgaria than the EU-average, this could be an amazing opportunity to establish Bulgaria as a role model country when it comes to support, enablement and education of female ICT specialists.
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5G readiness took a big step in 2020
Another detail within the report that might look like a negative but can be read as a positive is the 5G readiness. This is a crucial factor for future network speed and connectivity, especially in regards to AI development and the further growth of the Internet of Things. In 2020, Bulgaria's 5G readiness was at 0%. In 2021, it is at 25%, which is a huge step, even though the EU-average is more than double with 51%. This big shift is mainly due to the country approving and planing measures to build networks. With a big step as 25% development within one year, it is possible that Bulgaria can keep up the pace and catch up soon with their neighbours.
Bulgaria excells in AI development
Last but not least, the use and development of digital services in Bulgarian companies and public services might be below the average overall but has some highlights. In 2020, Bulgaria has signed the procurement contract for a new supercomputer in the Sofia Tech Park, setting up a long-term AI strategy to "support analysis of the quality of the environment and natural disaster management. It will be used in areas such as pharmacy, biochemistry, mechanics, quantum chemistry and monitoring of climate change." It is therefore no suprise that Bulgaria's AI use in enterprises is slightly higher than the EU-average with 31% compared to 25%. And incidentally, which probably is based on the close connection of AI research for environmental purposes, the use of ICT for environmental sustainability is also slightly above the average with 68% compared to 66%.
Maybe due to the AI strategy or the general goals of Bulgaria to strengthen its digital status quo, the digital public services for businesses as well as open data availability are on par with the European average. Additionally, Bulgaria was among the first countries in the EU to offer digital certificates for COVID vaccinations, thus decreasing the amount of paperwork and making it easier for citizens to gain their proof of vaccination.
Summary: A potential for big (digital) steps in the future
Having analyzed a few DESI reports for the Spotlight series, I can safely say that the overall rank hardly ever gives the full picture of a country's digital potential. Even though Bulgaria is among the last ranks, it shows strength in specific areas that can be lighthouse projects for the entirety of the EU, including a very strong female ICT workforce and AI integration for environmental and other scientific purposes.
Additionally, Bulgaria has gained a reputation for solid ICT services in the areas of nearshore, outsourcing and managed services. With a growing ICT service industry within the country, it is very likely that the digital growth of Bulgaria might jump ahead in the next few years, especially in the areas where it already excells in.
The main challenge seems to be the integration of digital services in both the public and business sector. Bulgarian companies and organizations need to digitize their services and widen their business products and services to digital channels. Especially ecommerce and the general implementation of modern, smart, and user-centric web environments are crucial to compete not only on a national but international scale.
In fact, I am convinced that this would solve several existing gaps in the DESI report.
- An increase in digital services demands for more ICT training and more attractive working conditions for Bulgarian ICT experts.
- In turn, pupils and students would see a more attractive future in the ICT business.
- The demand for ICT degrees and apprenticeships would rise which then would see an increase in academic and business offers.
- With more digital services to choose from, customers might be more inclined to use the internet for commerce and other activities.
- If people use the internet more often, they are more motivated to get digital education.
- Once commerce options are set up for the local market, the move to the international markets is much easier to implement and can widen both the audience and business opportunities.
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