Belarus’ Potential of Becoming Europe’s “Silicon Valley” by 2015 Assessed

June 5, 2012 - PRLog -- In the recent years the Belarusian ITO market has been developing at a fast pace, with a 24% - 28% growth rate on a year-on-year (YOY) basis (since 2009), 25% revenue increase, and market volume assessed at $384 million (as of 2011).

In the 2011 “Analysis of Belarus as an Offshoring Destination” Gartner concluded: “A strong education system and cost-competitive salaries, together with a reasonably strong workforce, have enabled Belarus to develop a mature IT outsourcing industry, supporting the country as an alternative destination for offshore activities, especially software development.”

While being one of the most controversial countries in Europe, oftentimes referred to as a “dictatorship”, over the past few years Belarus has managed to become one of the most powerful hotspots for the outsourced Research and Development (R&D) and IT, even though it is rarely mentioned in the official global industry ratings. Since 2005 Belarus has made and continues to make important steps towards becoming a true e-country with a well-developed ICT infrastructure, well-promoted ICT education, best-on-market IT resources and innovative ICT projects for both private and public sectors – steps that other officially recognized Central and Eastern European (CEE) hubs have not even planned yet.

The fact that many international giants such as Microsoft, IBM, Oracle, Siemens, T-Mobile, Alcatel, Coca-Cola, Philips, SAP as well as leading innovative niche players such as eBuddy and Steely Eye have entered the Belarusian ITO market in recent years proves Belarus’ ability to offer robust technology solutions and qualified resources comparable to the leading recognized ITO hubs.

Today’s Belarus ICT Talent pool is assessed at 25,000 specialists, which makes it one of the largest pools in the Central and Eastern European region (IT Strana, 2011). According to the Forbes Magazine, per capita income from IT services export in Belarus exceeds that of Russia and Ukraine (Park.By, 2012).

Belarus is ranked 56 by the ICT price basket, leaving behind such EU states as Bulgaria, Hungary, Slovakia, and Czech Republic and countries like Argentina, Brazil, India, China, and Mexico (SBBA, 2012). In the 2011 Ease-of-Doing-Business Rating Belarus has climbed up by 22 positions from 2010 (DoingBusiness.org, 2012). These and other indicators already put Belarus in an equal position with other CEE ITO leaders such as Ukraine, Hungary, Romania or Poland. The Belarusian government has ambitious goals of expanding the pool of ICT resources from today’s 25,000 up to 300,000 and increasing significantly the ICT readiness by 2015.

Belarus USPs

When the Belarusian government initiated the first High-Tech Park in the mid-2000s, it launched a massive promo campaign under the slogan “Silicon Valley of Belarus” (Belarus Time, 2006). After the respective Decree “On Belarus High-Technology Park” had been signed by the President in 2005, the government announced its ambitious plans to gradually convert the entire country into the European “Silicon Valley”. With this and other initiatives to be discussed below in this Review Belarus has “opened a door” for foreign companies to come in and use its ITO potential.

Having analyzed the most up-to-date analytics related to Belarus ICT and ITO markets, Ciklum has determined four unique selling points (USPs) that are likely to help convert Belarus into the Europe’s “Silicon Valley” in the near future.

1.   Geographical Location

Belarus has a favorable geographical location, especially for the European customers. It takes only 2 hours to get to Minsk from Paris, Frankfurt, Vienna, and less than 3 hours from Rome, London and Madrid by air (High-Tech Park, 2012).

Foreigners visiting Belarus require a visa (only the CIS countries’ residents are exempt from it): a single entry visa can be obtained right at the airport upon arrival, while a multiple entry visa (up to 12 months) should be obtained at the Belarus Embassy beforehand.

2.   Education

Back in the USSR times, Belarus was a hotspot for civil and military software development, robotics, artificial intellect, distributed computing networks and other high-tech solutions. As a result, the independent Belarus has inherited an excellent technical education system which is being strongly supported by the government. As of today, Belarus has 34 universities and higher degree institutions that graduate 16,000 ICT specialists annually (GoalEurope, 2012).

In an effort to modernize the technical education system and align educational programs with the real-life business needs, in 2010 the Belarusian government together with the state telecom companies initiated the ambitious project called “IT Country”. The project’s key goal is to boost the development of the Belarusian ICT market by creating a pool of over 300,000 IT specialists and generating around $7 billion in annual profit by 2015 (IT-Strana.By, 2012).

The following are some of the most robust initiatives under the “IT Country” Project aimed at improving and fostering ICT education among the Belarusian youth.

1).   To create a vast pool of ICT resources, the project initiators are attracting more students and graduates to get / improve the required ICT skills by offering innovative short-term training and re-training programs (one to eight weeks in duration) as well as longer-term modular programs. They also foster competition among different higher degree institutions to ensure a better quality of the obtained expertise. Another step planned by the “IT Country” project is to re-train people with engineering and accounting backgrounds to gain the most demanded technology skills. This initiative is supposed to add value to other projects (listed below) aimed to provide a sufficient workforce supply level for the future ITO industry (Lenta.Ru, 2012).

2).   A huge milestone achieved within the “IT Country” Project is the establishment of the IT Academy, an international training and R&D center. The Center determines the future strategy of the ICT market development, requirements for knowledge levels and skills, and also ensures an appropriate knowledge exchange among national and foreign students and certified specialists. Today, the IT Academy is the only educational center in Belarus that prepares business analysts for ICT sphere (Park.By, 2012).

3).   The prospective milestone to be met in the near future within the “IT Country” Project is the establishment of the IT Test Center that will develop special tests and metrics to better determine IT specialists’ levels of qualification as well as solutions to effectively re-direct them to innovative areas and technologies.

4).   In October 2011 the Belarusian Ministry of Education and QAI Global Institute (Orlando, USA), the world’s leading provider of express IT training programs, joined forces to create conditions for introduction and implementation of the leading international ICT training programs and certifications. The agreement signed by both parties envisions joint seminars and other educational events dedicated to software development project management, QA and testing, business analysis, processes’ maturity, competence assessment, teamwork and collaboration, and other important topics (IT-TUT.By, 2012).

It is expected that these and other initiatives will help promote ICT education among the Belarusian youth and significantly increase the supply of qualified IT resources for both domestic ICT and ITO industries in the years to come.

Read the full Review at http://www.ciklum.com/it-outsourcing-knowledge-center/whi...