Ukraine, despite its successful farming and metal industries, still suffers from elevated unemployment and static poverty levels. Due to foreign aggression and weak infrastructure, Ukraine has not been able to rebound from many of its economic downturns. Additionally, outdated models of production have caused the metallurgy sector to fall behind the global pace, and low productivity alongside restrictive laws limit Ukraine’s agricultural sector. As Ukraine looks to develop further, it has turned its focus to technology, creating a robust field that is rapidly expanding around the world. What was once a developing industry in Ukraine is transforming into a successful business model worldwide. As Ukraine continues to recover from the conflict and corruption plaguing its history, the continued expansion of technology into its economy will be the greatest investment for the country’s development. These five facts about technology in Ukraine are integral to understanding the country’s shifting economic state and transition out of poverty.
5 Facts About Technology in Ukraine
- Engineers and technicians were among the first to start businesses in Ukraine, which is a key factor in how the technology in Ukraine has grown to the industry it is today. One of the first companies that found international success was SoftServe, an outsourcing and out-staffing company. Two Ukrainian graduates founded the company in Lyiv and it now operates in the big data, cloud computing, DevOps, e-commerce, security and experience design technology sectors. SoftServe has grown into a company employing over 8,000 people in 35 offices worldwide.
- Ukraine’s tech engineers have already founded companies that have overtaken the global stage. Software companies saw unprecedented growth in the early 21st century, driven by increased demand and the introduction of an IT Creative Fund. One Ukrainian technology group founded during this period, Ciklum, provides client services including custom solutions development, quality engineering, data analytics and consulting. Now employing over 3,500 people, Ciklum has achieved recognition as a Fortune 500 company.
- Domestic economic developments have improved Ukraine’s ability to participate in the technology boom. The first development in the last decade is the drastically increased productivity of Ukrainian workers. Matching the efforts of surrounding developing economies such as Poland’s, Ukraine has been able to increase output per employee by about 22%. The second development comes in the rapid emergence of an information and communications technology sector, resulting in more than $3.5 billion in exports and accounting for more than a 10th of foreign investment in 2017.
- Individuals with Ukrainian heritage have become founders and leaders of some of the most powerful companies on the planet. The founder of the international messaging service WhatsApp, Jan Koum, is Ukrainian. Max Levchin, PayPal co-founder, and Alexander Galitsky, co-inventor of Wi-Fi, are of Ukrainian descent as well. Perhaps the most famous Ukrainian is the co-founder of Apple, Steve Wozniak. Ukrainians have played integral roles in the creation of many global businesses, and they participate in the development of economies worldwide.
- Kiev, the capital and most populated city in Ukraine, is home to one of the world’s most rapidly developing start-up hubs. Ukraine also boasts one of the world’s largest outsourcing hubs. Tens of thousands of workers are outsourced to Ukraine from companies like Oracle and Google, resulting in a thriving industry in the heart of Ukraine. Outsourcing technology firms like AMC Bridge, Ciklum, Miratech and Sigma Software are only some of the Ukrainian companies listed on the International Association of Outsourcing Professionals’ annual list of the world’s best outsourcing companies.
Despite these advancements in technology in Ukraine, in its fight against poverty, Ukraine still has a long road ahead. Progress has occurred through the development of technology, but many other industries lag behind due to continued attacks on Ukrainian infrastructure. Though Ukraine does well with regard to foreign investment, there are many avenues to establish greater connectivity with the global market that remain unexplored, especially within the European Union. With continued government support and a strong start-up culture, Ukraine has the potential to become a country that provides prosperity to its population.
– Pratik Koppikar