Central and Eastern Europe’s ICT/ITO Profiles: Ukraine

Posted: April 28, 2010 in Market Research

Ukrainian government support for the ICT industry has been reprioritized, and since late 2008, the government has undertaken a series of emergency measures to stabilize the banking sector.

The government has created the Ukraine Development Gateway Project to promote electronic government (e-government) and support an information economy in the country.

According to Gartner (2009), the telecom services are operated in the country by an estimated 1,300 companies and the country has a very good prospect for Internet access and Internet Protocol (IP) services.

For the first quarter of 2009, the average real monthly wage in the ICT sector declined by almost 17% versus the same quarter for the previous year.

The continuing decentralization of outsourcing industry in Ukraine remains a positive factor for IT services market development. Outsourcing accounts for more than 70% of software development activity in Ukraine. In 2009 UKraine’s ITO market value reached EUR 389.6 million.

Affected by the economic stagnation, small outsourcing services providers have to merge with the larger players or discontinue their operations. Leading outsourcing companies have managed to restructure and optimize their business to become more client-centric, which has led to substantial revenue growth and made Ukrainian IT outsourcing market go beyond traditional outsourcing (typical of India and China) and move to a next stage of outsourcing maturity.

Ukraine resides among the lowest-cost destinations for IT outsourcing in Europe, according to Gartner.

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