And the winners are China and India - The BECH Index 2020

And the winners are CHINA and INDIA

THE BECH INDEX 2020

Hans Peter Bech

TBK PUBLISHING

Š Hans Peter Bech, March 2020 First edition Unless otherwise indicated, Hans Peter Bech copyrights all materials on these pages. All rights reserved. No part of these pages, either text or images may be used for any purpose other than personal use. Therefore, reproduction, modification, storage in a retrieval system or retransmission, in any form or by any means, electronic, mechanical or otherwise, for reasons other than personal use, is strictly prohibited without prior written permission.

The business model framework is distributed under a Creative Commons license from Strategyzer AG and can be used without any restrictions for modeling businesses.

Published by TBK PublishingÂŽ (a division of TBK Consult ApS), CVR: DK27402917 www.tbkconsult.com/publishing ISBN: 978-87-93116-44-3 TBK-WIPA-035

The BECH Index 2020

Table of contents: Table of Contents

3

Target audience

4

Abstract

4

Author

4

Acknowledgements

4

The COVID-19 pandemic

5

China is now the largest market for IT products and services

6

Grow fast or die slow

6

How?

7

Where?

8

Table 1: The BECH Index for the Major Markets 2014-20

8

The Top 25 Markets

10

Table 2: Top 25 Information Technology Countries in the World

10

Table 3: The BECH Index for the Americas 2014-20

11

Table 4: The BECH Index for The European Union 2014-20

12

Table 5: The BECH Index for The Rest of Europe 2014-20

13

Table 6: The BECH Index for The Middle East 2014-20

14

Table 7: The BECH Index for Africa 2014-20

15

Table 8: The BECH Index for Asia Pacific 2014-20

16

The BECH Index

18

About the author

19

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The BECH Index 2020

Targeted audience The target audience for this whitepaper is the board of directors, the CEO and the sales and marketing executives of B2B information technology companies with ambitions for achieving global market leadership.

Abstract This whitepaper presents an estimation of the relative demand capacity for B2B information technology and related services worldwide. This estimation is called “The BECH Index.”

TBK Consult calculates the BECH Index annually based on data published by The Central Intelligence Agency (CIA). The 2020 report is based on the CIA estimates for 2019 and does not reflect the impact of the COVID-19 pandemic. The virus will no doubt claim a substantial portion of the economic growth in most countries, but it may not impact the overall distribution of industrial demand. We will not know for sure until we see the numbers.

The CIA is an independent agency responsible for providing national security intelligence to senior US policymakers. The CIA is separated into four basic components: the National Clandestine Service, the Directorate of Intelligence, the Directorate of Science & Technology, and the Directorate of Support. They carry out “the intelligence cycle;” the process of collecting, analyzing, and disseminating intelligence information to top US government officials.

Please observe that the CIA revises their assessments, which may obsolete the BECH Index assessments for previous years.

OBS: The BECH Index for 2016 and onwards uses a new algorithm and the data is therefore not compatible with previous BECH Index reports. All indexes in this whitepaper have been recalculated.

Author Hans Peter Bech, M.Sc. (econ.)

Acknowledgements Thank you to Manuel Cunha for pointing out mistakes in our reginal classification. The mistakes have been corrected retrospectively for all the years in this report.

Data collection and proof reading: Emma Crabtree, ecr@tbkconsult.com Design and lay-out: Jelena Galkina, info@kompot.ee

_____________________________________________________ 1

Source: https://www.cia.gov/about-cia/todays-cia/index.html

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The BECH Index 2020

The COVID-19 pandemic The COVID-19 pandemic is changing the agenda for most businesses in all countries and it is uncertain what the world will look like on the other side.

This whitepaper is based on the CIA national accounting estimates for 2019 and does not reflect the impact of the COVID-19 pandemic. The virus will no doubt claim a substantial portion of the expected economic growth in most countries, but it may not impact the overall distribution of industrial demand. We will not know for sure until we see the numbers in 2021.

In general, the pandemic will stimulate the demand for numerous software products.

Anything associated with remote work and virtual collaboration and meetings will experience a surge in demand. People will learn the benefits of skipping commuting and travel and of working from home. They will get familiar with the tools required to do so. Business owners and executives will appreciate the benefits of the reduced need for real estate and they will discover that most of their staff can actually manage themselves.

Closing schools and other educational institutions will enforce the implementation of e-learning solutions. On the other side of the pandemic we will have a population of teachers and students that all have practical experience with these tools. I will be surprised if that does not have a positive impact on the demand for e-learning platforms.

Maybe the greatest impact will be seen in the demand for healthcare related software. Anything from EHR2 -systems, global databases and analytics to public communication and e-learning systems will see growing demand. While we on a global scale may disagree about much, none of us want another pandemic. Most nations will co-operate in finding solutions that can stop or control the spread of another contagious virus and reduce its impact. Software will play a major role in such initiatives.

As you read this whitepaper please remember that the figures and conclusions are based on preCOVID-19 statistics. The outcome of the pandemic may change the world, but we will not know for sure until the beginning of 2021.   _____________________________________________________ 2

EHR: Electronic Health Record

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The BECH Index 2020

China is now the largest market for IT products and services We expected that the change would happen sooner, but based on the 2019 national accounting estimates China has now become the largest IT-market in the world. With a share of 17.79 per cent China has surpassed the USA, which represents 16.79 per cent of global demand. However, adding Canada, North America still represents 18.23 per cent of the total market.

We don’t know yet how the current COVID-19 pandemic will impact the global economy and especially China’s position. We anticipate that many companies will be forced to consider alternative sources and that some of them will not return to China.

However, we expect that China will recover and maintain its position as the world’s largest market.

With or without the COVID-19 pandemic China remains a difficult market. For smaller software companies there are still easier fish to catch.

Grow fast or die slow The information technology industry is by nature a global industry.

In this industry we are blessed with low cost of entry and simple supply chains. International growth therefore comes much easier than in most other industries.

Embarking on the global growth journey is also a necessity. The combination of simple supply chains, economy of scale advantages and “crossing the chasm”3 characteristics make the information technology industry a “winner takes all” game.

Information technology companies either grow fast or die slowly.4 The market leader enjoys enormous advantages over number two, three and so on. Chances are that number one will continue to increase her market share while the followers will lose out. It’s not only the good old rule that the army with the most soldiers normally wins the battle. The information technology industry is governed by some very specific dynamics that are best understood by studying The Law of Diffusion of Innovation5 and the Crossing the Chasm theory.

_______________________________________________________________________________________ See Crossing the Chasm, 3rd Edition: Marketing and Selling Disruptive Products to Mainstream Customers by Geoffrey A. Moore.

3

4

Grow fast or die slow April 2014 by Eric Kutcher, Olivia Nottebohm and Kara Sprague, McKinsey&Company

5

https://en.wikipedia.org/wiki/Diffusion_of_innovations

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The BECH Index 2020

Because of the nature of information technology products, the market prefers buying from the market leader. The first to reach the tipping point in a market gets caught by the tornado and suddenly revenue generation isn’t the primary concern anymore. Demand will drive revenue and fulfillment becomes the primary challenge.

How? As information technology companies prepare for global growth the first question to answer is “how?�

We discuss these issues in the first three whitepapers in this series named Entering a Foreign Market in the Information Technology Industry 6 and in my upcoming book Going Global on a Shoestring.7 We recommend that B2B information technology companies verify the viability of their business models in their domestic market first. When growing revenue has been proven profitable, predictable and scalable then it is time to conquer foreign markets.

_______________________________________________________________________________________ 6

These whitepapers are available for download from www.tbkconsult.com

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https://tbkconsult.com/product/the-book-going-global-on-a-shoestring/

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The BECH Index 2020

Where?

The second question asked before jumping to foreign markets is, “where we should go next?”

To help information technology executives make this decision based on facts rather than emotions, TBK Consult calculates and publishes the BECH Index annually.

The BECH Index for a country reflects the demand capacity of the country and thus also reflects the share of global demand for information technology related products and services.

Table 1: The BECH Index for the Major Markets 2014-208 Region

2014

2015

2016

2017

2018

2019

2020

North America

21,04%

20,49%

20,35%

18,60%

18,58%

18,50%

18,23%

South America

9,07%

8,95%

8,60%

8,25%

7,84%

7,98%

7,85%

Americas

30,12%

29,45%

28,95%

26,85%

26,43%

26,48%

26,08%

The European Union

19,20%

18,99%

19,00%

17,34%

17,44%

17,36%

17,08%

6,73%

6,35%

6,30%

6,27%

6,42%

6,43%

6,30%

Middle East

5,12%

5,30%

5,27%

5,62%

5,58%

5,50%

5,42%

Africa

3,23%

3,31%

3,35%

3,77%

3,59%

3,61%

3,56%

EMEA

34,27%

33,95%

33,91%

33,00%

33,04%

32,91%

32,37%

Australia/NZ

1,24%

1,63%

1,20%

1,20%

1,18%

1,18%

1,17%

Japan

4,93%

4,67%

4,57%

4,45%

4,49%

4,46%

4,39%

China

13,42%

13,61%

14,18%

16,47%

16,85%

16,68%

17,97%

South Korea

1,54%

1,51%

1,50%

1,62%

1,57%

1,56%

1,53%

Taiwan

0,95%

0,93%

0,92%

0,97%

0,93%

0,93%

0,92%

India

5,34%

5,46%

5,68%

6,71%

6,78%

7,10%

6,99%

Rest of Asia

8,18%

8,80%

9,08%

8,73%

8,73%

8,69%

8,59%

35,61%

36,61%

37,14%

40,15%

40,53%

40,61%

41,56%

100%

100%

100%

100%

100%

100%

100%

Rest of Europe (incl. Switzerland)

Asia The World

The world market is divided into 229 countries of which some of the bigger countries must be considered as several markets. Talking about the US as one market when you haven’t won the first customer or independent channel partner there yet may seem overly self-confident. For most information technology companies, the US is at least 50 geographical markets, Germany is 14 markets (Bundesländer), France is at least 4 markets, the UK is 4 markets, the Nordics are 4 markets and so on. _______________________________________________________________________________________ Please note that the numbers in this white paper are due to the application of a new algorithm which will differ from BECH Index whitepapers from before 2016.

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The BECH Index 2020

As can be seen from Table 1, world demand continues moving east. The Americas have experienced a 15 per cent decline in the period 2014-2020.

The demand from Central and South America drops again in 2020 and the decline in demand from North America results in a net loss of 1,52 per cent for the area.

The European Union has lost 11 per cent of global demand in the same period and after a slight increase in 2018, the decline continues in 2020. Russia, the sixth biggest market, has lost 13,79 per cent since 2014. The loss in 2020 is 2,18 per cent.

North America and Europe continue to be very interesting areas with some of the biggest markets in the world and because of increasing labor costs and public expenditure there is a growing need for information analytics, process and cost optimization information technology-based solutions.

The Middle East’s share of global demand has decreased continuously since 2017 and the region has lost 3,65 per cent in four years. Future growth in the Middle East still requires a restructuring away from the dependency on oil and gas and a general liberation of the economy. I remain skeptical that they will be successful with such a transformation and predict a continued decrease in the region.

China continued its growth and has, with a 7,69 per cent growth from 2019 to 2020, become the largest information technology market in the world pushing the USA to second place.

For 2020 the Asia Pacific region’s share of global demand increased 2,33 per cent. The most prominent growth area is India showing a 34 per cent increase in the period 2014-2019. However, from 2019 to 2020 India’s share of world demand declined 1,57 per cent.

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The BECH Index 2020

The Top 25 Markets These 25 countries make up more than 80% of world demand for information technology products and services with 204 countries sharing the remaining 20%. This doesn’t mean that these 25 markets are the most attractive as issues other than size may play a more important role. The six countries USA, China, India, Japan, Germany and Russia make up over half of world demand for information technology.

Table 2: Top 25 Information Technology Countries in the World Rank Rank Rank Rank 2016 2017 2018 2019

Share 2020

Country

2

2

2

2

16,79%

China

1

1

1

1

17,97%

USA

3

3

3

3

6,99%

India

4

4

4

4

4,39%

Japan

5

5

5

5

3,39%

Germany

6

6

6

6

3,07%

Russia

7

7

7

7

2,64%

Brazil

8

8

8

8

2,51%

UK

9

9

9

9

2,44%

France

12

10

10

10

2,16%

Indonesia

11

12

12

11

1,92%

Mexico

10

11

11

12

1,92%

Italy

16

15

13

13

1,65%

Turkey

15

13

14

14

1,53%

Korea, South

13

19

15

15

1,47%

Spain

14

14

16

16

1,44%

Canada

17

16

17

17

1,29%

Saudi Arabia

19

17

18

18

1,18%

Iran

18

18

19

19

1,01%

Australia

21

20

20

20

0,92%

Taiwan

22

21

22

21

0,90%

Thailand

23

23

23

22

0,86%

Egypt

25

22

21

23

0,84%

Poland

20

24

24

24

0,78%

Nigeria

26

25

25

25

0,73%

Pakistan

Accumulated

49,53%

62,35%

70,84%

76,68%

80,79%

Apart from China taking the leading position pushing the USA to second place, none of the other countries have changed their position from 2019 to 2020.

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The BECH Index 2020

Table 3: The BECH Index for the Americas 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

19,31%

19,28%

19,16%

17,23%

17,25%

17,05%

16,79%

1,58%

1,57%

1,55%

1,52%

1,48%

1,46%

1,44%

20,89%

20,85%

20,71%

18,75%

18,73%

18,51%

18,23%

Argentina

0,80%

0,86%

0,75%

0,72%

0,70%

0,70%

0,69%

Belize

0,00%

0,00%

0,00%

0,00%

0,00%

0,03%

0,00%

Bolivia

0,05%

0,05%

0,05%

0,06%

0,06%

0,06%

0,06%

Brazil

3,45%

3,34%

3,14%

2,78%

2,71%

2,68%

2,64%

Chile

0,38%

0,37%

0,37%

0,38%

0,36%

0,35%

0,35%

Colombia

0,55%

0,56%

0,56%

0,56%

0,56%

0,55%

0,54%

Costa Rica

0,08%

0,08%

0,08%

0,07%

0,07%

0,07%

0,07%

Cuba

0,18%

0,13%

0,12%

0,12%

0,11%

0,11%

0,11%

Dominican Republic

0,12%

0,12%

0,13%

0,14%

0,13%

0,13%

0,13%

Ecuador

0,16%

0,16%

0,15%

0,15%

0,15%

0,15%

0,15%

El Salvador

0,05%

0,05%

0,05%

0,05%

0,04%

0,04%

0,04%

Falkland Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Guatemala

0,11%

0,11%

0,11%

0,11%

0,11%

0,11%

0,10%

Grenada

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Honduras

0,03%

0,03%

0,04%

0,04%

0,03%

0,03%

0,03%

Jamaica

0,03%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Mexico

1,97%

1,95%

1,95%

1,99%

1,84%

1,95%

1,92%

Nicaragua

0,03%

0,03%

0,03%

0,03%

0,02%

0,03%

0,03%

Panama

0,09%

0,08%

0,09%

0,09%

0,08%

0,09%

0,09%

Paraguay

0,05%

0,05%

0,05%

0,05%

0,05%

0,06%

0,06%

Peru

0,32%

0,32%

0,32%

0,34%

0,30%

0,33%

0,32%

Puerto Rico

0,10%

0,10%

0,09%

0,10%

0,09%

0,09%

0,09%

Uruguay

0,07%

0,07%

0,07%

0,06%

0,06%

0,06%

0,06%

Venezuela

0,53%

0,49%

0,45%

0,39%

0,30%

0,28%

0,28%

South America

9,13%

8,97%

8,62%

8,26%

7,83%

7,94%

7,78%

30,02%

29,82%

29,33%

27,01%

26,56%

26,45%

26,01%

USA Canada North America

Americas

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Table 4: The BECH Index for The European Union 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

Austria

0,41%

0,43%

0,43%

0,37%

0,36%

0,36%

0,36%

Belgium

0,53%

0,52%

0,51%

0,48%

0,46%

0,46%

0,45%

Bulgaria

0,13%

0,13%

0,14%

0,12%

0,12%

0,12%

0,12%

Czech Republic (Czechia)

0,28%

0,33%

0,34%

0,29%

0,29%

0,29%

0,29%

Denmark

0,27%

0,26%

0,26%

0,25%

0,25%

0,25%

0,24%

Estonia

0,04%

0,03%

0,04%

0,03%

0,03%

0,03%

0,03%

Finland

0,23%

0,21%

0,20%

0,20%

0,20%

0,20%

0,20%

France

2,93%

3,44%

3,41%

2,54%

2,48%

2,47%

2,44%

Germany

3,72%

3,54%

3,52%

3,55%

3,45%

3,44%

3,39%

Gibraltar

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Greece

0,33%

0,31%

0,30%

0,27%

0,26%

0,26%

0,25%

Hungary

0,23%

0,22%

0,22%

0,23%

0,23%

0,23%

0,23%

Iceland

0,02%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Ireland

0,19%

0,18%

0,23%

0,27%

0,27%

0,27%

0,27%

Italy

2,30%

2,16%

2,11%

2,03%

1,96%

1,95%

1,92%

Latvia

0,05%

0,04%

0,04%

0,05%

0,05%

0,05%

0,04%

Liechtenstein

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Lithuania

0,08%

0,07%

0,07%

0,07%

0,07%

0,07%

0,07%

Luxemburg

0,06%

0,05%

0,05%

0,06%

0,06%

0,06%

0,06%

Netherlands

0,82%

0,78%

0,79%

0,76%

0,74%

0,74%

0,71%

Norway

0,32%

0,37%

0,36%

0,31%

0,31%

0,30%

0,30%

Poland

0,78%

1,14%

1,16%

0,88%

0,89%

0,86%

0,84%

Portugal

0,31%

0,29%

0,28%

0,27%

0,27%

0,27%

0,26%

Slovakia

0,14%

0,14%

0,14%

0,15%

0,14%

0,14%

0,14%

Slovenia

0,06%

0,06%

0,06%

0,06%

0,06%

0,06%

0,06%

Spain

1,66%

1,28%

1,27%

0,98%

1,50%

1,50%

1,47%

Sweden

0,42%

0,44%

0,44%

0,43%

0,42%

0,42%

0,41%

UK

2,90%

2,58%

2,62%

2,65%

2,55%

2,55%

2,51%

EU

19,20%

18,99%

19,00%

17,34%

17,44%

17,36%

17,08%

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Table 5: The BECH Index for The Rest of Europe 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

Albania

0,03%

0,02%

0,02%

0,03%

0,03%

0,03%

0,02%

Andorra

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Belarus

0,13%

0,16%

0,15%

0,13%

0,13%

0,13%

0,13%

Bosnia and Herzegovina

0,04%

0,03%

0,04%

0,04%

0,03%

0,04%

0,03%

Croatia

0,09%

0,08%

0,08%

0,08%

0,08%

0,08%

0,08%

Cyprus, Republic

0,03%

0,01%

0,01%

0,03%

0,03%

0,03%

0,03%

Faroe Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Georgia

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

Greenland

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Guernsey

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Isle of Man

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Jersey

0,01%

0,00%

0,00%

0,01%

0,00%

0,01%

0,01%

Kosovo

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Macedonia

0,03%

0,03%

0,03%

0,03%

0,02%

0,02%

0,02%

Malta

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Moldova

0,02%

0,01%

0,01%

0,02%

0,02%

0,02%

0,02%

Monaco

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Montenegro

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Romania

0,32%

0,46%

0,47%

0,37%

0,37%

0,38%

0,37%

Russia

3,56%

3,17%

3,17%

3,17%

3,16%

3,14%

3,07%

San Marino

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Serbia

0,08%

0,10%

0,09%

0,08%

0,08%

0,07%

0,07%

Switzerland

0,49%

0,42%

0,41%

0,45%

0,44%

0,44%

0,44%

Turkey

1,43%

1,30%

1,32%

1,46%

1,66%

1,68%

1,65%

Ukraine

0,37%

0,45%

0,40%

0,28%

0,27%

0,28%

0,27%

Rest of Europe

6,73%

6,35%

6,30%

6,27%

6,42%

6,43%

6,30%

13 www.tbkconsult.com

The BECH Index 2020

Table 6: The BECH Index for The Middle East 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

Bahrain

0,05%

0,05%

0,05%

0,06%

0,06%

0,06%

0,05%

Egypt

0,81%

0,74%

0,79%

0,86%

0,88%

0,87%

0,86%

Iran

1,06%

1,03%

1,02%

1,13%

1,20%

1,20%

1,18%

Iraq

0,39%

0,36%

0,35%

0,46%

0,49%

0,46%

0,45%

Israel

0,27%

0,16%

0,17%

0,27%

0,26%

0,26%

0,25%

Jordan

0,08%

0,05%

0,05%

0,07%

0,07%

0,07%

0,07%

Kuwait

0,18%

0,28%

0,27%

0,22%

0,21%

0,20%

0,20%

Lebanon

0,08%

0,08%

0,07%

0,07%

0,07%

0,08%

0,08%

Oman

0,11%

0,11%

0,11%

0,14%

0,14%

0,14%

0,14%

Qatar

0,20%

0,24%

0,23%

0,26%

0,25%

0,25%

0,24%

Saudi Arabia

1,23%

1,40%

1,41%

1,41%

1,34%

1,31%

1,29%

Syria

0,06%

0,09%

0,04%

0,04%

0,04%

0,04%

0,04%

U.A.E.

0,47%

0,59%

0,61%

0,54%

0,51%

0,50%

0,50%

West Bank

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Yemen

0,11%

0,10%

0,07%

0,06%

0,05%

0,06%

0,06%

Middle East

5,12%

5,30%

5,27%

5,62%

5,58%

5,50%

5,42%

Table 7: The BECH Index for Africa 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

Algeria

0,41%

0,41%

0,41%

0,46%

0,45%

0,43%

0,43%

Angola

0,09%

0,09%

0,09%

0,12%

0,12%

0,12%

0,11%

Benin

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Botswana

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

Burkina Faso

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Burundi

0,01%

0,01%

0,01%

0,00%

0,00%

0,00%

0,00%

Cameroon

0,05%

0,05%

0,05%

0,06%

0,06%

0,06%

0,06%

Cape Verde

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Central African Republic

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Chad

0,02%

0,03%

0,03%

0,02%

0,01%

0,01%

0,01%

Congo, Republic of the

0,01%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Cote d'ivoire

0,07%

0,08%

0,08%

0,07%

0,07%

0,07%

0,07%

Dem. Rep of the Congo

0,04%

0,05%

0,05%

0,05%

0,05%

0,04%

0,04%

→ 14 www.tbkconsult.com

The BECH Index 2020

Country

2014

2015

2016

2017

2018

2019

2020

Djibouti

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Eq. Guinea

0,01%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Eritrea

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Eswatini

0,01%

0,01%

0,01%

0,01%

0,00%

0,01%

0,01%

Ethiopia

0,12%

0,11%

0,12%

0,12%

0,12%

0,12%

0,12%

Gabon

0,02%

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

Gambia

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Ghana

0,10%

0,07%

0,08%

0,09%

0,09%

0,10%

0,10%

Guin. Bissau

0,00%

0,00%

0,00%

0,00%

0,02%

0,02%

0,02%

Guinea

0,01%

0,01%

0,01%

0,01%

0,00%

0,00%

0,00%

Kenya

0,10%

0,13%

0,13%

0,11%

0,10%

0,10%

0,10%

Lesotho

0,00%

0,00%

0,00%

0,01%

0,01%

0,00%

0,00%

Liberia

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Libya

0,10%

0,08%

0,07%

0,07%

0,02%

0,04%

0,04%

Malawi

0,02%

0,01%

0,01%

0,02%

0,02%

0,02%

0,02%

Mali

0,03%

0,02%

0,03%

0,02%

0,01%

0,02%

0,02%

Mauritania

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Morocco

0,17%

0,21%

0,22%

0,23%

0,22%

0,22%

0,21%

Mozambique

0,03%

0,03%

0,03%

0,03%

0,02%

0,03%

0,03%

Namibia

0,02%

0,02%

0,02%

0,02%

0,01%

0,02%

0,02%

Niger

0,02%

0,02%

0,02%

0,01%

0,01%

0,01%

0,01%

Nigeria

0,75%

0,83%

0,83%

0,86%

0,82%

0,80%

0,78%

Rwanda

0,02%

0,01%

0,02%

0,02%

0,02%

0,02%

0,02%

Saint Helena

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

SĂŁo Tome and Principe

0,00%

0,00%

0,00%

0,00%

0,03%

0,00%

0,00%

Senegal

0,03%

0,03%

0,03%

0,03%

0,01%

0,04%

0,04%

Sierra Leone

0,01%

0,01%

0,01%

0,00%

0,01%

0,01%

0,01%

Somalia

0,00%

0,00%

0,00%

0,00%

0,01%

0,01%

0,01%

South Africa

0,38%

0,36%

0,36%

0,65%

0,62%

0,62%

0,61%

South Sudan

0,03%

0,03%

0,03%

0,01%

0,01%

0,01%

0,01%

Sudan

0,08%

0,08%

0,08%

0,13%

0,13%

0,12%

0,12%

Tanzania

0,10%

0,10%

0,10%

0,11%

0,11%

0,11%

0,11%

Togo

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Tunisia

0,11%

0,11%

0,11%

0,11%

0,11%

0,11%

0,10%

Uganda

0,06%

0,06%

0,06%

0,06%

0,06%

0,06%

0,06%

Western Sahara

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Zambia

0,05%

0,05%

0,05%

0,05%

0,05%

0,05%

0,05%

Zimbabwe

0,02%

0,02%

0,02%

0,02%

0,03%

0,03%

0,03%

Africa

3,23%

3,31%

3,35%

3,77%

3,59%

3,61%

3,56%

15 www.tbkconsult.com

The BECH Index 2020

Table 8: The BECH Index for Asia Pacific 2014-20 Country

2014

2015

2016

2017

2018

2019

2020

Australia

1,08%

1,48%

1,05%

1,05%

1,02%

1,03%

1,01%

New Zealand

0,16%

0,15%

0,16%

0,15%

0,15%

0,16%

0,15%

Australia/NZ

1,24%

1,63%

1,20%

1,20%

1,18%

1,18%

1,17%

Japan

4,93%

4,67%

4,57%

4,45%

4,49%

4,46%

4,39%

China

13,42%

13,61%

14,18%

16,47%

16,85%

16,68%

17,97%

Korea, South

1,54%

1,51%

1,50%

1,62%

1,57%

1,56%

1,53%

Taiwan

0,95%

0,93%

0,92%

0,97%

0,93%

0,93%

0,92%

India

5,34%

5,46%

5,68%

6,71%

6,78%

7,10%

6,99%

26,19%

26,18%

26,85%

30,22%

30,62%

30,73%

31,79%

Afghanistan

0,05%

0,05%

0,05%

0,05%

0,05%

0,05%

0,05%

American Samoa

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Armenia

0,02%

0,02%

0,03%

0,02%

0,02%

0,02%

0,02%

Azerbaijan

0,09%

0,10%

0,10%

0,12%

0,12%

0,12%

0,11%

Bangladesh

0,45%

0,64%

0,66%

0,49%

0,50%

0,50%

0,49%

Bhutan

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Brunei

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Burma

0,19%

0,16%

0,18%

0,22%

0,21%

0,21%

0,20%

Cambodia

0,04%

0,05%

0,06%

0,04%

0,04%

0,04%

0,04%

Comoros

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Cook Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

East Timor

0,00%

0,01%

0,01%

0,00%

0,00%

0,00%

0,00%

Fiji

0,01%

0,00%

0,00%

0,01%

0,01%

0,01%

0,01%

French Polynesia

0,01%

0,00%

0,00%

0,01%

0,00%

0,00%

0,00%

Guam

0,00%

0,01%

0,00%

0,00%

0,00%

0,00%

0,00%

Haiti

0,02%

0,02%

0,02%

0,02%

0,01%

0,01%

0,01%

Hong Kong

0,51%

0,31%

0,31%

0,44%

0,43%

0,43%

0,44%

Indonesia

1,88%

2,10%

2,15%

2,23%

2,21%

2,19%

2,16%

Kazakhstan

0,40%

0,23%

0,24%

0,38%

0,37%

0,37%

0,36%

Kiribati

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Korea, North

0,03%

0,05%

0,05%

0,03%

0,02%

0,02%

0,02%

Kyrgyzstan

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Laos

0,03%

0,04%

0,05%

0,03%

0,03%

0,03%

0,03%

The Big Countries

→ 16 www.tbkconsult.com

The BECH Index 2020

Macau

0,10%

0,03%

0,04%

0,06%

0,07%

0,07%

0,07%

Madagascar

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

Malaysia

0,61%

0,72%

0,76%

0,68%

0,69%

0,68%

0,67%

Maldives

0,01%

0,00%

0,00%

0,01%

0,01%

0,01%

0,01%

Marshall Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Mauritius

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Micronesia

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Mongolia

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

0,03%

Nauru

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Nepal

0,06%

0,06%

0,06%

0,05%

0,06%

0,06%

0,06%

New Caledonia

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

0,01%

Niue

0,00%

0,00%

0,00%

0,00%

0,01%

0,01%

0,00%

Northern Mariana Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Pakistan

0,77%

1,13%

1,15%

0,75%

0,75%

0,75%

0,73%

Palau

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Papua New Guinea

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Philippines

0,59%

0,66%

0,68%

0,66%

0,67%

0,66%

0,65%

Samoa

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Seychelles

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Singapore

0,47%

0,37%

0,38%

0,45%

0,44%

0,45%

0,44%

Solomon Islands

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Sri Lanka

0,19%

0,22%

0,22%

0,20%

0,22%

0,21%

0,21%

Tajikistan

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

0,02%

Thailand

0,91%

0,86%

0,93%

0,93%

0,92%

0,91%

0,90%

Tokelau

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Tonga

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Trinidad and Tobago

0,05%

0,05%

0,05%

0,04%

0,03%

0,03%

0,03%

Turkmenistan

0,05%

0,05%

0,05%

0,07%

0,07%

0,07%

0,07%

Tuvalu

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Uzbekistan

0,13%

0,19%

0,20%

0,15%

0,15%

0,15%

0,15%

Vanuatu

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Vietnam

0,36%

0,43%

0,45%

0,43%

0,45%

0,45%

0,45%

Wallis and Futana

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

0,00%

Asia Pacific

8,18%

8,80%

9,08%

8,73%

8,73%

8,69%

8,59%

35,61%

36,61%

37,14%

40,15%

40,53%

40,61%

41,56%

Asia Pacific Total

17 www.tbkconsult.com

The BECH Index 2020

The BECH Index We changed the algorithm behind the BECH Index from 2016 and onwards. We still use the Gross Domestic Product9 (GDP) as estimated and published by the CIA in their World Factbook10 and we still use the Purchasing Power Parity version that adjusts for the differences in the cost of living and price levels across the world.

The new BECH Index uses the GDP composition on agriculture, industry and services. We assume that the demand for information technology will grow as a society moves from dependency on agriculture, through being dominated by industry to mainly producing services. We recognize that the productivity improvements that enable a society to survive and prosper with relatively small portions of the GDP coming from agriculture and industry is enabled and supported by information technology (and free international trade). However, we presume that the post-industrial activities are consuming far more information technology products and services than the primary and secondary sectors.11 We have also decided to rename the annual report so that the current version is based on GDP data from the previous year. GDP data are published by the national statistical departments, but not all countries publish at the same time and some do not publish the data each year. We therefore wait for the CIA to gather and assess the data before we calculate and publish the BECH Index.

_______________________________________________________________________________________ The GDP is a monetary measure of the market value of all final goods and services produced in a period (quarterly or annually). Nominal GDP estimates are commonly used to determine the economic performance of a whole country or region, and to make international comparisons.

9

10

https://www.cia.gov/library/publications/resources/the-world-factbook/

11

The new BECH Index is based on the three-sector theory: https://en.wikipedia.org/wiki/Three-sector_theory

18 www.tbkconsult.com

The BECH Index 2020

About the Author

Hans Peter Bech Hans Peter Bech is an Amazon bestselling author. He is a frequent blogger on how to make information technology companies global market leaders and has written several books and numerous whitepapers on business development in the IT industry. Hans Peter also facilitates workshops for the TBK AcademyÂŽ and is an advisor to governments and multi-nationals. He holds a M.Sc. in macroeconomics and political science from the University of Copenhagen.

More about Hans Peter Bech

TBK-WIPA-035

Other publications by the author

19 www.tbkconsult.com