10 percent lower software piracy rate would bring 3,711 new jobs and USD 573mln to the GDP

If the software piracy rate goes down by 10 percent over the next ten years, this will lead to the creation of 3,711 new workplaces and it would add USD 573 million to the GDP. A 10 percent lower piracy rate would also generate supplementary revenues of USD 498 million for the local IT industry and USD 87 million additional tax collection revenues for the government.

These are findings of the first IDC survey on Romania regarding the impact of the software industry on the economy. 

The piracy rate in Romania is in line with the piracy rate in countries in Central and Eastern Europe. Thus, the Business Software Alliance study regarding piracy pointed to a piracy rate of 65 percent in Romania, while the average for the CEE region is 64 percent. In 2003, the piracy rate in Romania was 73 percent.

Last year, it is estimated that piracy caused Romania to lose USD 183 million, which was still a 39 percent smaller figure compared to the previous year.

“Clearly, the IT sector- and especially the software industry- represents a strong source of economic benefits for Romania. But the contribution at this point only represents a part of the potential economic gains that could be obtained in and beyond the software industry,” says  Magda Popescu, BSA lawyer.

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 Software industry impact on Romanian economy

•  There are more than 48,000 people hired in IT this year and there were more than 46,000 last year. This number is expected to soar above 67,000 by 2014.

•  The Romanian government’s tax collection totaled more than USD 361 million from IT-related activities. More than USD 746 in tax collection are expected by 2014, which would represent an annual 15.6 percent growth rate for the period 2009-2014.

•  There were more than 1,600 IT companies in Romania last year. Their number is expected to over 1,800 by 2014

•  Cash-in from the IT industry represented approximately 1.1 percent from the GDP in 2009 and this figure is expected to reach 1.3 percent by 2014

 Impact of the financial crisis on the IT domain

•  The IT market in Romania decreased by 18.8 percent last year, compared to the previous year, to a value of USD 1.81 billion. Hardware sales represented 56.9 percent from the total market, software represented 14.9 percent and IT services represented 28.2 percent.

•  This year, the market is expected to return on a positive trend

•  IT expenses are estimated to have a compound annual growth rate of 11.1 percent over the next five years to a total of USD 4.06 billion in 2014.