Azerbaijan is emerging as a key player in the nearshore IT services landscape, with a stable and growing ICT sector marked by significant employment and innovative digital initiatives. The sector, which employed 62,400 people in 2021, is bolstered by Azerbaijan’s commitment to digitalization reforms and strategic projects like the Digital Silk Way, enhancing its digital ecosystem. The government’s digitalization efforts, including the Digital Trade Hub and Industry 4.0 center, position Azerbaijan as a key digital hub.

New opportunities exist in the ICT sector as Bulgarian companies work to increase their competitiveness in the EU and as the Bulgarian government complies with EU directives and legislation concerning its digital economy. Bulgaria’s ICT sector is characterized as stable and constantly growing, making it one of the most profitable sectors in Bulgaria. Bulgaria has a long, rich tradition in the IT and electronics sectors (dating back to the Communist era) and is still known as the Silicon Valley of Southeastern Europe.

Croatia is becoming a hub for nearshoring IT services with its booming digital economy and dynamic ICT sector. Offering competitive salaries, the sector’s consistent growth is complemented by a leading start-up ecosystem. In 2021, ICT salaries increased by seven percent to 1,854 euros. Despite a modest overall workforce share, Croatia has seen steady expansion in ICT employment. The country’s commitment to digital transformation is evident in initiatives like the Strategy for Digital Croatia 2030. With a stable political and economic environment, Croatia is an ideal location for nearshore software development, combining skilled talent, cost-effectiveness, and a strategic European position.

Egypt’s Information and Communications Technology (ICT) sector is very robust, with a growth rate higher than Egypt’s overall GDP growth, equivalent to 15.2 percent in the fiscal year 2019/2020. Its contribution to the GDP has increased to 4.4% in the fiscal year 2019/2020 compared to 3.5% in 2018/2019. Total investments in the sector increased by 35 percent in 2019/2020 and reached $3.5 billion.

Hungary is gaining traction as a start-up hub in Eastern Europe, with over 1,500 start-ups supported by 140 investors, including successful ventures like Prezi and SEON. The country’s start-up enterprise value reached 2.4 billion euros in 2022. With a population of 9.7 million, Hungary’s business-friendly environment, featuring a nine percent corporate tax rate, attracts foreign investors. The Digital Workforce Programme underscores Hungary’s commitment to surpass the EU average in digital development by 2030, signaling a focus on industry growth and digital skills.

The growing ICT sector in North Macedonia reflects the country’s commitment to technological and economic progress. Since gaining independence in 1991, North Macedonia has become an upper-middle-income country and a hub for nearshore software development. The government’s proactive steps, like creating the Fund for Innovation and Technology Development (FITD) and aligning with the EU’s DESI goals through a robust ICT strategy for 2023-2027, have laid a solid foundation for innovation and technological growth.

Pakistan is steadily gaining traction as a pragmatic nearshore software development hub, with a consistent 20-30% annual revenue growth in its IT industry over the past decade. With IT resources offering approximately 70% cost savings compared to Europe or North America, the country has seen a notable 137% growth in IT exports in the last five years. With a population exceeding 220 million and a youthful workforce familiar with Western practices, Pakistan presents a stable and cost-effective IT outsourcing and investment option. Global enterprises like Bentley, IBM, Mentor Graphics, S&P Global, Symantec, Teradata, and VMware have recognized this, contributing to Pakistan’s growing stature in the global IT arena.

The Central and Eastern European (CEE) IT sector is rapidly developing today. In 2021, the Global Outsourcing 100 included more than a dozen companies in their list, with the main office in the CEE region with IBA Group, Solberg, Sigma Software, and others among them. According to The IT Landscape: The Future of IT in Emerging Europe report, the CEE IT sector is estimated to have 2 million people employed in 2020, and the number is growing by 3% each year. Meanwhile, the region’s most prominent IT talent pool is in Poland. It reached over 400,000 software developers in 2019.

The Portuguese National ICT Sector is a highly innovative and dynamic sector, which already represents nearly 10% of the Portuguese GDP, reaching almost 20 billion US$ in total turnover, according to the latest data available from the National Portuguese ICT Cluster, TICE. With young and highly qualified resources, it employs more than 80,000 people; in the past decade, the profile of ICT companies has shifted from traditional ICT providers to highly specified and innovative start-ups and is supported by world-class research developed in partnership with Portuguese universities.

Romania is becoming increasingly crucial for nearshore software development due to its business-friendly environment and growing digital economy. With approximately 220,000 professionals in 2023 (2.8% of the working population), the ICT sector is among the most competitive and highly skilled in Eastern Europe. Romania’s good rankings in the IT Competitiveness Index and leading broadband speeds make it a top choice for nearshoring. Practical advantages include security aspects in cities such as Cluj-Napoca and Oradea, cultural and historical ties, a multilingual heritage in Transylvania, and matching time zones, as well as EU membership since 2007, which offers legal and financial benefits to companies.

Serbia is emerging as a nearshore IT hub in Eastern Europe, moving from 48th to 44th in the World Bank’s Doing Business ranking. The ICT sector plays a significant role, contributing 10% to the GDP, with notable growth in exports and employment. Serbia’s e-participation and online services are noteworthy, indicating a focus on digital advancement. With a strategic location, a well-educated workforce, and a growing IT sector, Serbia is gaining prominence as a destination for nearshoring IT services.

Slovakia is becoming known for its software development industry in Central Europe. The ICT sector there has expanded, with jobs growing from 65,500 in 2015 to 105,400 in 2021, and exports in this sector reaching 1.65 billion euros. Ranked 58th in the world for start-ups, Slovakia has strengths in marketing, sales, and technology, including hardware, IoT, and software. The gaming industry in Slovakia is also growing, helped by skilled workers and educational programs, which has led to more revenue and new game developers.

Taiwan’s rise as a leading nearshore IT hub is driven by its transformation from a small electronics industry to a global technology leader. Home to giants like TSMC and UMC, Taiwan excels in R&D and efficient OEM/ODM production. Its robust role in global computing and the semiconductor industry, alongside a strategic location, educated workforce, and stable environment, makes it an attractive destination for quality, cost-effective nearshore IT services.

Tunisia’s ICT sector is an important part of its economy, employing about 80,000 people across 1,800 companies and showing significant growth. The sector’s service exports have increased from USD 32.1 million in 2004 to around USD 300.5 million in 2017, indicating Tunisia’s growing presence in the global IT market. Government initiatives like ‘Start-up Tunisia’ and attractive investment laws are driving this growth. Tunisia is becoming a notable choice for nearshore software development due to its cost-effective and high-quality offerings.

The rapidly growing IT sector is one of the most exciting and attractive industries in Ukraine, with over 4,000 tech companies. It is also diverse – from nanotechnologies and blockchain to AI and game development. 18 Ukrainian companies are listed among the 100 top outsourcing companies by the International Association of Outsourcing Professionals. More than 100 Fortune 500 clients and several other large companies have chosen Ukrainian IT services, including Nasdaq, Amazon, Adobe, SAP, Hotels.com, Vodafone, ING, Microsoft, Allianz, Bosch, KIA, Playbuzz, SAS, Volvo, Viaplay, etc.