Ukraine’s Key IT Sector Booming Despite Russian Invasion, Telecom News, ET Telecom


Part of an apartment is seen next to buildings damaged during heavy fighting in Mariupol, in the territory under the government of the Donetsk People’s Republic, eastern Ukraine, Thursday, May 13, 2022. (AP Photo)

Lviv: Ukraine’s IT sector is booming despite the Russian invasion. Workers with stickers on their laptops lie on deck chairs outside a warehouse for start-ups in the western Ukrainian city of Lviv, giving off major Silicon vibes Valley.

But the atmosphere inside is different.

Through the complex’s glass doors, young Ukrainians zigzag between piles of bulletproof vests and boxes full of helmets ready for the front.

They are part of Ukraine’s burgeoning tech sector that was forced to adapt after the Russian invasion and became essential to sustaining the war effort.

“Most tech companies had prepared contingency plans” in case of war, said Stepan Veselovskiy, the leader of the “IT Cluster Lviv” community.

He told AFP that the companies moved servers to secure sites and set up backup systems outside the country before the Russian invasion on February 24.

When the Russian bombings began, IT companies closed offices in the capital Kyiv and the eastern city of Kharkiv and engineers took refuge in western Ukraine or neighboring Poland.

Veselovskiy said there were already around 500 tech companies in Lviv before the war, but now estimates that 80% of the sector is in the western city.

One is Infopulse, which provides various digital services to mainly European customers.

It has brought 300 of its 2,300 employees to Lviv, where it has offices in one of the few buildings in the city equipped with a bunker.

There are bunk beds and a stable internet connection in the basement so that employees can continue working in the event of an air raid.

There are also generators in case Russian forces target power plants and terminals for Elon Musk’s Starlink internet service.

“Even in the most drastic conditions, business can continue,” said regional manager Ivan Korzhov.

They may even thrive.

Tech Army

Since the start of the war, Infopulse has won four new customers and in April, the second month of the Russian invasion, it created 25 new jobs in Ukraine.

It’s not the only tech company in Ukraine to do so.

Veselovskiy said February – when Russia attacked – was a historically good month for Ukraine’s tech sector and its roughly 200,000 employees.

“It slowed down a bit in March, but we are very optimistic for the future because the war is not stopping us from growing,” he said.

It’s a stark contrast to other industries battered by the invasion. Exports from traditional sectors such as steel and agriculture have collapsed.

But the technology sector, of course, has not been affected by the destruction of bridges, roads or the blocking of ports.

It has, according to Veselovskiy, earned more than $2 billion since the start of the war and has become the country’s top exporter.

“It’s a good thing for Ukraine because we generate dollar revenue every month when the country really needs it,” Korzhov said.

“We pay our taxes and give a lot of money” to the government.

The Kyiv IT cluster has already allocated $2 million, primarily to purchase equipment for Ukrainian soldiers.

This is how his offices came to look like a military depot.

The sector has also offered its brightest to help the military.

Softserve – one of Ukraine’s largest tech companies – worked on army websites for free, and the Kyiv IT cluster upgraded one of the army’s command centers.

Infopulse is also participating in a joint project of the Ukrainian army and the Ministry of Digital Transformation.

“Technology and cybersecurity specialists are working with the government on the information front,” said its regional director Korzhov.

He then repeated a popular slogan in Ukraine: “We are not waiting for peace, but for victory”.

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