IT professionals on the market
of the Belarusian IT talent is being outsourced
was the value of the IT export in 2019
IT students graduates annually from 55 tech universities
Size: 207,600 sq km, ranked 87th in the world by area (comparable to Kansas)
Population: 9.48 million, ranked 94th in the world by population
Time zone: (GMT+3)
Government: unitary presidential republic, although considered a dictatorship by many states; the US and EU do not recognize the current president as legitimate
Official languages: Belarusian, Russian
GDP per capita, PPP: $19,943 (2019 est.)
Human Development Index: 0.817 (ranked 50th | very high)
Currency: the new Belarusian ruble (BYN)
Economy: market socialism
Main industries: metallurgy, mechanical engineering, chemical and petrochemical, light industry, food industry
Major urban areas (over 500K people): Minsk, Gomel
Ease of doing business: ranked 49th, DB score - 74.3
Digital competitiveness index: not classified
Corruption perception index: #66 out of 198, with signs of improvement
The WE Forum Global Competitiveness Report: not classified
A.T. Kearney Global Services Location Index: not included
Universities: 42 universities, two listed by QS World University Rankings® 2020 (ranked 351 and >800)
The largest IT companies: Itransition, Iflexion, ScienceSoft, N-iX, Wargaming.net
IT industry market share: 5.7% of GDP, 2.2% share in employment, 1,500 IT companies, ca. 54,200 IT specialists
EF English Proficiency Index: 52.39 *(below average)
International Olympiad in Informatics: 98 medals, 16 gold, 41 silver, 41 bronze
Considering that 60% of its IT market is external or outsourced, Belarus has a strong reputation as a reliable IT outsourcing destination. Belarus's robust IT sector is believed to be growing four to five times faster than in other countries. Government-led initiatives such as public subsidies, tax incentives, and free economic zones for IT & tech companies encourage establishing private sector enterprises (see Deloitte report on Belarus for more details on this).
However, the domination of outsourcing in the IT services delivery is both boon and bane for the local IT market (and outsourcers). On the one hand, outsourcing skills in Belarus are readily available, allowing outsourcers for fast rollout and scaling of their software design, development, and testing teams. On the other, the overwhelming volume of outsourcing work may be at the expense of innovation. After all, most engineers in Belarus contribute to a third party's intellectual property.
Moreover, due to its compact size, Belarus may offer limited choice regarding experts well-versed in niche technologies (such as Go, TypeScript, or Rust) or combining varied skills (e.g., data analytics + programming). Instead, it has a vast pool of experienced, affordable IT professionals covering more popular languages and services.
● A Junior Software Developer earns ca. $900/month (gross) on average
● A Senior Software Developer typically gets $2,600+/month (gross)
● An average salary of a Development Lead is about $3,600+/month
● The rates in Belarus sit in the mid-range compared to other CEE countries
● They are slightly above the Ukrainian and draw nearer the Polish rates
[Source: IT Outsourcing Review]
The high level of entrepreneurship in Belarus and its remarkable success in IT offshoring may be somewhat surprising, considering its political unrest. Belarusian authorities take definite actions to stimulate market growth in the IT sector. Yet, the widespread control over entrepreneurs comes with its share of risks, especially if we consider Lukashenko’s inclinations towards dictatorship and his close ties with Moscow.
Belarusians are pursuing the opening towards the West. However, it seems unlikely that Russia will let go of its influences any time soon. After the heavily disputed results of the presidential election in 2020 (which haven’t been recognized by most global leaders, including the European Parliament), mass protests erupted throughout the country. Since then, government-imposed connectivity and cellular service outages have been periodically disrupting work for thousands of digital workers, affecting their workflows and impacting service delivery.
Reacting to these events, IT specialists joined grassroots movements, and thousands of them have even signed an open letter calling for re-elections. Following the country's alarming situation and a shattered business climate, analysts anticipate a mass exodus of Belarusian IT workers abroad unless anything changes in the next few months.
The transition is already happening, with a growing number of dev shops and tech enterprises threatening to halt their investment plans and move to other countries. In August 2020, the dev.by website informed about 12 IT companies transferring employees abroad, 59 pursuing partial relocation, and 112 considering their options.
Software is the number one Belarusian export to the USA, comprising over one-third of its total exports. Its value in 2019 was estimated at ca. $2 billion.
According to the Ministry of Economy, about 15,000 Belarusian IT specialists are permanently involved in software export, carrying out projects for an international client base.
About 30% of Fortune Global companies have outsourced IT work to specialists located in the famous Hi-Tech Park, one of Europe's largest business incubators for IT and home to nearly 500 software & tech companies.
The diverse range of globally-recognized consumers of Belarusian software services includes Samsung, Whirlpool, British Telecom, T-Mobile Deutsche Bank, London Stock Exchange, and Deloitte PepsiCo, or Procter & Gamble, among other household names.
The local service companies are also quite successful in raising foreign investment and pursuing acquisitions, especially on the booming game development and mobile apps market:
However, when we look at foreign companies that decided to open their in-house centers in the country (some examples include Fitbit, Yandex, Netcracker, Viber, and Luware), the list gets remarkably shorter. The business is there, and the capital is flowing, but the country still struggles to convince global tech champions to roll out their local centers despite numerous tax incentives (see below).
The reasons may include the Belarusian IT outsourcing market's very nature, heavily prioritizing services export rather than attracting investors to launch regional offices. The state’s excessive (and unpredictable) interference with business, high level of corruption, and an ineffective judiciary don’t help, either.
- 0% corporate income tax for 5 years;
- 10% VAT;
- 0% corporate income tax for 15 years;
- 0% VAT;
However, many of these incentives are only available to Belarusian legal entities and don't apply to a representative office. Therefore, the subsidiary is the most widespread legal form for foreign investors in Belarus.
More information about tax incentives and exemptions in Belarus and the legal requirements for setting up a business in the country is available in the official state information resources, Pravo.by and Belarus.by.
According to the State University website, the Belarusian higher education (HE) system currently comprises 42 state and 15 non-state HE institutions. Most of them are located in the capital, Minsk, with several Grodno, Brest, Vitebsk, Gomel, and Mogilev facilities.
Until recently, private HE institutions mainly offered education in humanitarian, social, and economic fields. This primarily resulted from the lack of sufficient budget to invest in adequate research facilities and equipment. Following the increasing demand for science and technology courses, they began expanding their curricula to account for the new trend and ensure a greater alignment between graduates’ skills and job market needs.
The Belarusian startup scene has been showing remarkable growth in recent years, largely spurred by the 2017 Decree on developing the digital economy. The document created advantageous conditions for product-based companies. It also provided for the further development of the famous Hi-Tech Park. The technology hub was established in 2005 to nurture the growth of local tech enterprises and woo foreign investors with tax exemptions and incentives.
The strategy has pulled off. Since the law’s establishment, entrepreneurial projects have been booming in the country, with brand new startups launching every minute. It's estimated that over the last five years, Belarusian startups raised nearly $250 billion from venture deals, with a record of $77 billion raised in 2018 alone.
However, following the stormy events of 2020, the local startup scene has been losing its momentum lately. Currently, Belarus ranks 63rd in 2020 Startup Blink's Global Startup Ecosystem Report, down by eight spots compared to 2019. Minsk occupies 63rd position in the cities ranking – a fall by 16 locations from 2019.
Minsk, Brest, Gomel-Raton, Vitebsk, Mogilev
AI/ML, AR/VR, Medtech, IoT, SaaS
Wargaming – the world-renowned game developer behind "The World of Tanks" was born in Minsk in 1998. By now, it has exploded into a global enterprise with nearly 1,800 employees located in over 20 offices worldwide. Over the years, the company has completed four acquisitions, undergone ten rounds of investments, and moved its headquarters to Cyprus. The current valuation of the business stands at $1.5 billion.
FriendlyData – a natural language search interface for business databases. After securing a series of funding from local investors, the startup was bought in 2018 by an American software vendor ServiceNow for an undisclosed amount.
The State of CEE IT Outsourcing and Offshoring 2021
Belarus • Poland • Romania • Ukraine
CEE countries are world-renowned for their software developers who are said to be one of the best on the globe.
There are over 1 million software developers in the CEE region, skilled in various technologies and experienced in every industry.
Software developers' hiring rates in the CEE region can be 2-3x lower when compared to the US and Western Europe.
Great English skills and vast experience in working on international projects. CEE devs have been supporting startups worldwide for years now.
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