Economic development of Ukraine: Part 2. IT sector of Ukraine

Economic development of Ukraine: Part 2. IT sector of Ukraine

Competitiveness of national economies is closely connected to the development of IT sector. To date, Ukraine is ranked 73rd in the ICT Development Index published by the International Telecommunication Union (ITU). The ranking and report prepared by the ITU’s experts reflect the status of progress that has been made on ICT access, which includes fixed and mobile telephony, Internet bandwidth, and the number of households with computers and the Internet. Ukraine’s rank is low. For example, Belarus, Kazakhstan and Russia have a higher rate of ICT development. 

To redress the situation, significant organizational efforts need to be made. The IT industry’s development effectiveness depends on the Ukrainian Government’s efforts to introduce information technology and adopt digital systems to replace the analogue ones.

The most successful example offers Estonia.  The country adopted the Digital Agenda and eGovernment Program. In addition, there is a Chief Technical Officer responsible for the implementation of IT development program. Perhaps that’s why NATO Cooperative Cyber Defence Centre of Excellence is located in Estonia. 

IT sector is a driving force of Ukrainian economy. The forecasts for IT sector development are positive. Ukrainian IT sector is developing and will continue to do so, because there are talents and ideas in Ukraine. An indicator is the European Bank for Reconstruction and Development which intends to invest around USD 50-60 million in Ukrainian IT companies and establishes a special fund for that purpose.

The deployment of 3G mobile technology will be an important factor for accelerated development of the information and communications technology sector of Ukraine. A long history of 3G mobile standards implementation is nearing completion. As a result of trades on 23 February, 2015, three national mobile operators (MTS Ukraine, Kyivstar and Astelit) obtained licenses for the deployment of 3G (third generation) mobile technology. According to experts, Ukraine has chosen an “evolutionary” approach for the development of communication networks, when operator modernizes existing 2G networks and adapts them to new technical requirements of 3G. 

Specialists believe that Ukraine already has a multi-billion dollar IT industry. Human capital is Ukraine’s competitive advantage. Thousands of programmers work in Ukrainian companies. In 2014 Ukrainian specialists became the most demanded freelancers in Eastern Europe. In addition, companies that focus on foreign clients increased their profits. 

To maintain Ukraine’s position on the international IT market, in 2014 Torben Majgaard, CEO and founder of Ciklum, launched the BrainBasket Foundation. The Foundation’s main objectives are to train an additional 100,000 IT professionals by 2020, and generate more than $10 billion in export revenues. Currently, BrainBasket Foundation is engaged in studying of educational eco-system in Ukraine, and it is working actively at scaling of the educational projects and creating a career map for future IT specialists. 

It should be noted that both, Ukraine and foreign investors, have mutual benefits from that cooperation. IT professionals don’t leave Ukraine to work abroad. Otherwise, it would be difficult to stem a flow of highly skilled people out of Ukraine. Currently, Ukrainian companies are unable to create an enabling environment for the realization of their full potential and career development. 

 

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