Ukraine IT Analysis:
Impacts On The IT Business

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Ukraine faces a difficult business climate for Information Technology products and services.  With global declines in IT needs, Ukraine will no doubt experience the negative after-effect of this pendulum swing.  In a galloping economy, Ukraine could move forward at a good pace, despite the larger difficulties the country faces. That’s because the power was perhaps in the hands of the seller of services (the IT talent). But as world IT competition grows, investors and buyers/sellers will redefine their power and look beyond a “cheap” labor force to negotiate their best deal.  The role of the government, its policies, the culture and people will all factor into the decision-making process for selecting the most-desirable county (ies) for software outsourcing or any type of IT FDI.  Successful countries will be those that can unite as one and demonstrate their vision and support for IT using all the resources they have. Unfortunately, the challenges Ukraine faces are not easy fixes.  They are a country still moving from a command economy (through the turbulence of change) to a democratic country.   Investors look closely at taxation, piracy, corruption, and legal inadequacies, among others.  Having a cheap labor force, (albeit talented) is not enough when faced with the possibility that your code may get stolen.  The financial loss of intellectual property is far more worrisome over the long term. And that may indeed be where Ukraine is facing its greatest IT challenge of all: balancing the need for short-term cash and payoffs with the wisdom (and patience) to work a long-term plan where the investments will yield a far greater payback to the country and its IT sector.

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