Minister's Opening Address for a Seminar on Software - Tokyo, Japan
(Ávarp ráðherra á málstofu um tæknihugbúnað)
23 October 2001


Ladies and gentlemen,

"All you need in this life is ignorance and confidence; then success is sure"

These words of Mark Twain come to mind when considering the radical changes that have taken place in our whole economical situation during the past year. The new economy has not turned out to be the solution everybody hoped for. Maybe we were too naive believing that. I however think our setbacks may be our success because I firmly believe that the software and the high tech industry are our keys to new economical upturn.

The Government of Iceland has emphasised as many international organisations have the necessity for the Icelandic society to diversify. By doing this, the Government is putting stronger pillars under our economy to structure it like all good constructors do. As will be explained further later on the sectors subject to discussion here today are surely among these pillars.

In this context it gives me a great pleasure addressing you here today.

Software
It is no coincidence that we have chosen to discuss software and high technology in this seminar here today. One of the fastest growing industries in Iceland is the software industry. All numbers indicates this. Number of jobs have doubled since 1995, turnover has gone from 30 million dollars to 150 million dollars and is expected to rise still another 20% in 2001. These figures are among the highest in the world. Export of Icelandic software knowledge is growing as more and more Icelandic companies are established abroad marketing Icelandic products and at the same time stimulating further software development in Iceland.

This is globalisation at its best.

Director of one of the largest software companies in Iceland came to me recently and said: "Iceland is the ideal society for software development. I think even Iceland is the best suited country in the world to develop the 4th and 5th generation of mobile phones"

I of course asked the gentleman to explain himself. So he started to argue his case for me and pointed very rightly to me the following facts:
· 65% of the industry work force is university educated.
· The infrastructure of the society is high class with all basic services available in a competitive market environment.
· Software developing groups with broad knowledge of the subject can easily be established resulting in a final product ready for the market in much shorter time than elsewhere.
· There are no language barriers. The hardware is built on English and the work force can easily work in English.
· The society is stable and open to new technology.
· 81% of the population has access to computers of which 71% are Internet connected.
· Tax environment is competitive, especially with recently proposed changes.

Let me take an example of this. The Ministry for Foreign Affairs is using a computerised document system to which all our embassies abroad are connected. It simply means that I can see what my Embassy in Tokyo is doing every day, their documents are transferred to me few times a day. When we prepared this visit faxes were hardly necessary. Documents were just registered and scanned in Tokyo and appeared on my screen at once and vice versa

This is the result of a software development that started 8 years ago in our administration when 5 persons sat down with software developers. The system was implemented in three different ministries where further development took place. The system has now been used in all Icelandic ministries for some years and has now been developed to serve the whole Ministry of Foreign Affairs wherever its offices may be located.

Following the success of this solution in the Icelandic administration the company has made an alliance with IBM Corporation to sell this product worldwide. The GoPro, as software is called, has in the last years become one of the largest IBM software partners in Europe with more than 600 employees in five European countries. They were listed number 16 on the list of Europe's fastest growing companies last year.


High Technology
It is not just the Software export that is growing. The same goes for the High technology industry where companies in the genetic research area have been established. They are already making regular progress in their research relating more and more different diseases to our genes. In Iceland more than one such companies have developed the biggest being DeCode genetics employing around five hundred highly educated people. The company has brought back many Icelandic experts who otherwise would not have turned back to Iceland.

In this case as in the case of the software sector; Iceland is actually benefiting from its size, which in this case has given us unique opportunities for research in this area.

As you can imagine this is of great economical importance to Icelandic Society. Especially this is another important step in our objective to diversify our economy.

Another important area in this respect is our energy sector. This area is of course related to the necessity for all nations to pay more attention to this area as we focus more on clean energy. In this respect I especially refer to our geothermal energy as over 90% of our houses are heated with geothermal water. Most of our electricity is produced by clean energy and now we are working closely with big international companies like Shell, Norsk Hydro and Daimler Chrysler in developing hydrogen as a suitable energy for instance for cars.



Ladies and gentlemen,

Technology in all its form is the driving force of the future economy. Recent setbacks for the new economy will in my mind not change this; it will just make us better equipped for the future challenges.

In this respect Iceland is definitely not small; on the contrary in this respect we are big. Our weapon in this area is surely our size.

The key thing in all this development is that even though one machine can do the work of fifty ordinary men. No machine can do the work of one extraordinary man.

The key to success in these areas I have addressed here today is after all the man.