Government studies capacity building program for local IT firms
CNET Software Technologies, a local IT company, has started constructing an ICT center in the Ethio-ICT Village (ICT Park) in Bole Lemi Industrial Park at a cost of 480 million birr.
Minister of Communication and Information Technology Debretsion Gebremichael (PhD) yesterday laid the cornerstone for the construction of the ICT Center in the Bole Lemi ICT Park. Construction work has already commenced a head of the corner stone laying ceremony.
CNET Software Technologies PLC is building the ICT center on 8000sqm plot of land located in the Ethio-ICT Village which was inaugurated in June 2015. Bemnet Demissie, general manager of CNET Software Technologies Plc, said that the ICT Center includes Software development center, cloud ERP (Enterprise Resource Planning) data center, call center (contact center), research center and auditorium. Bemnet said the project includes the construction of four buildings but the company has started constructing the first block with its own financial resource. The company plans to complete the construction within 18 months.
CNET Software Technologies was established in 2004. The company develops software for, among others, hospitality industry, manufacturing industry, merchandizing (supermarkets) and health sector. The company has 5000 customers. Together with its sister companies CNET has 250 employees and hopes to create 1100 jobs when the new ICT Center is completed and starts work with full swing.
Bemnet believes that his company would provide high quality software to the local hospitality and manufacturing industries and start exporting its products once the ICT Center is fully functional.
Debretsion said that CNET Software Technologies is one of the pioneers in the ICT development sector by investing in the Ethio-ICT Village. “They are among the first companies who were registered to join the IT Park. Though everything is not available they decided to start investing the ICT-Village. We want to see many CNETs,” Debretsion said.
The minister said that the ICT sector is not capital intensive. “It is a knowledge based industry. You can create jobs for the youth, you can save foreign currency and export your products and generate foreign currency. We do not want you to be limited here,” he told executives of CNET.
Debretsion said the ICT sector could be an engine of growth for developing nations. He said his government is committed in developing the ICT sector adding that the government is building the infrastructure and would support local IT firms. “So far it is only local IT firms that joined the IT Park because we first want the local companies to build their capacity. But we will soon start permitting foreign IT companies that would create market for the local firms.”
Bemnet told The Reporter that his company is determined to channel its products to the international market and generate foreign currency. However, he said access to finance is a major bottleneck to the ICT sector. “Banks are not yet familiar with extending loans to IT companies. Our banks need collateral and unlike manufacturing and other sectors IT companies do not have collaterals,” Bemnet said. He pointed out that dearth of skilled manpower is the other challenge.
Debretsion said that his ministry is drafting a strategic plan for the development of the local ICT sector. “We have hired consultants that are studying a capacity building program. The study would identify how we can support local IT companies. Financing and incentives that would be availed to the local IT companies would be addressed in the study,” he told The Reporter.
CNET Technologies, which was established by two entrepreneurs with a registered capital of 350,000 birr 13 years ago, has raised its capital to 22 million birr. The company has an annual turnover of 35 million birr.
The Bole Lemi ICT Park that lies on 200 hectares plot of land costs the government two billion birr. One hundred companies have been registered to join the IT Park, which was inaugurated in June 2015. So far, 20 IT firms have started working in the buildings constructed by the government. Ethio Telecom is building its new headquarters in the ICT Village.
The government wants to replicate the success of the Ethio-ICT Village in the regional states. “We want to build more IT parks in the regional states,” Debretsion said.