Digital transformation drove countries in Western Europe to look for larger pools of available software development talents, with nearshoring increasingly being considered. According to Gartner, IT spending in Europe is expected to record a 9% growth in 2024, with software projected to boost by 14.5%, and IT Services by 11.8%.
The same source states that the tech talent shortage faced by the region is one of the main grounds for the growing demand for IT Services. Local technology and service providers are a good strategy for filling in the gap of professionals and achieving an enterprise’s strategic goals. However, migrating towards nearshore companies comes with its own list of benefits, including a larger availability of skills, cost and time efficiency, and teams with a greater expertise across industries.
The hidden gem of nearshoring destinations for Western European countries, Moldova, is a digital hub with a flourishing IT industry. Its geographical position and time zone, university educated talents with top-notch skills, dynamic English-speaking IT community, and the cultural proximity to Western Europe are just some of the advantages it could bring for businesses from the region. Moreover, it is not by chance that the IT industry of the country registers a solid number of companies with foreign investments.
Foreign investors in Moldova’s IT industry – an overview
Created in 2018, Moldova IT Park (MITP) is the first e-park in Europe, aiming to create a friendly ecosystem for the development of the IT industry. Reduced tax burden (unique worldwide), simplified visa procedures, flexible location anywhere in Moldova are just some of the benefits provided to MITP residents that among others, put the country into a good light for foreign investors.
Out of the 1,544 active MITP residents in 2023, 15% are companies with foreign investments (equating to 228 residents) – a 9% growth compared to 2022. As of the end of 2022, the countries with the highest number of companies being a resident of MITP were the USA (36), Romania (29), Germany (22), and the UK (17). Additionally, 50% of MITP’s turnover is generated by these companies, and they also hold 40% of the total number of employees (19,700+ professionals), residents of the park.
An additional essential element that puts Moldova on the map for foreign investors is the cultural compatibility that local IT professionals share with their peers from abroad, especially those coming from Western European countries. You can find more about the culture-fit common patterns in this research.
On top of that, in 2022, IT services accounted for 20,8% ($471,75 million) of the total service exports of the Republic of Moldova. At the same time, data from 2021 shows that the primary beneficiaries of the IT services provided by software development companies from Moldova are situated within the European Union. The top 5 destinations include Romania, Germany, the Netherlands, Italy and Cyprus. They are followed by non-EU countries, with the United States, the United Kingdom, and Switzerland securing the top 3 positions.
The IT Community – a dynamic and proactive ecosystem
MITP and the large pool of IT experts are just some of the factors that make Moldova an attractive destination for companies from Western Europe. In fact, the IT community of the country is a dynamic and proactive ecosystem where the contributions of international tech figures become more and more prominent.
Annually, events like Moldova Developer Conference, Product Management Conference, Product Design Conference, Tech Women Summit, various trainings, and hackathons gather remarkable crowds of IT professional at Tekwill, the main location in the country where the IT community gathers to connect and share ideas.
The increased presence of worldwide IT pioneers as speakers at these events proves the thriving interest and attention Moldova has gaining in recent years.
ISD – the long-term partner for your software projects
ISD is a software development provider with office location in the Netherlands and a development center in Moldova. The company started its journey in 2008 as a Java development company with a focus on intralogistics.
Over time, ISD has expanded its capabilities, developing projects in various industries, such as pharma, e-commerce, automotive, insurance etc. using Java, and other technologies, such as .NET, Phyton, and JavaScript. The provider works with customers located across the globe, in countries like the Netherlands, Germany, Belgium, Slovakia, Turkey, the United States, Australia etc.
If you are also planning to build a software product, ISD is the long-term partner you are looking for. Leave us a message and our experts are going to come back to you shortly.