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Bitter Truth behind US$300 Million Exports
Korea’s e-Government Systems
Bitter Truth behind US$300 Million Exports
  • By matthew
  • August 12, 2013, 03:25
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Korea is exporting its e-government systems to an increasing number of countries. Last year, the total exports topped 33.5 billion won (US$300 million). However, the systems’ high dependence upon imported software is coming under fire. 

The Korean government has worked together with local IT service providers for 10 years to export its electronic government systems. Still, few of the systems such as the database management systems (DBMS) and those for enterprise resource planning (ERP) have adopted domestically-developed software. 

Launched in 2002, the system export projects’ purpose is to help Korean IT companies make inroads into overseas markets. In most cases, these have been underway in developing countries in the form of grant-type aids and fund support, which means the taxes paid by the Korean people are spent on the projects placed by those nations. Nevertheless, Korean IT firms are supplying software imported from Oracle, SAP, IBM, and the like, instead of domestically developed ones, for the DBMS, ERP, and related solutions. 

According to industry sources, major Korean software developers like Tibero, Altibase, Younglim Softlab, and Tobesoft have participated in almost none of the e-government system export projects, even though they have their own software products comparable to the imported ones. Of the four companies, only Tibero has supplied its solutions in the mail distribution system establishment project in East Timor, back in 2009. This is why experts are pointing out that the government needs to come up with some measures to expand the supply of domestically-developed software during the course of such projects. 

The government, to its credit, is trying to deal with the problem. During a press conference in May, Minister of Science, ICT, and Future Planning Yoon Jong-rok said that he would launch more Official Development Aid (ODA) projects abroad to increase the supply of software developed by Korean firms in tandem with the Ministry of Foreign Affairs, Ministry of Trade, Industry and Energy, etc. Nonetheless, no specific measures are available as of now. 

“Once the number of such ODA projects increases, local software companies’ overseas businesses will gain some steam,” said an industry insider, adding, “It order to do so, none other than the government should move ahead with a strong will.” In the meantime, IT service providers like Samsung SDS and LG CNS are refusing to reveal which products they use, based on their confidentiality agreements with their clients. 

“We admit that we could not think of software localization as a project we put on track just three or so years ago,” said an official at the Ministry of Security and Public Administration who is in charge of such projects. He went on, “We agree to the necessity of using domestically-developed software, but we will be able to consider that only after the projects mature.”