INTERVIEW: “The weekend’s protests were the Russian people's, not the opposition’s” – Maxim Reznik
Western Balkans citizens legally resident in EU equal to 14% of region’s population
International Ice Hockey Federation (IIHF) has stripped Belarus of the right to hold the World Championship this year
Alexei Navalny arrested on arrival as he returns home
@russian_market sacked by UBS for supporting Navalny
Elbrus Capital attracts major international players to invest in the Russian digital sphere
Russian President Vladimir Putin and US President Joe Biden have first phone call, extend START II treaty for five years
ING: Russian budget’s modest deficit leaves fiscal room for 2021
Public support is collapsing for The People’s Servant Party
Ukraine’s industrial output jumped 4.8% y/y in December
State-owned Ukrgasbank signs off on convertible €30mn IFC loan ahead of its privatisation
National Bank of Ukraine retains a key policy rate at 6%, the outlook of the CPI deteriorates
Estonia's two big parties agree on grand coalition
VISEGRAD BLOG: Central Europe's populists need a new strategy for Biden
LONG READ: The oligarch problem
OUTLOOK 2021 Lithuania
Czech billionaire Kellner´s PPF makes another bid for Moneta Money Bank
Czech MPs pass protectionist food law in violation of EU rules
M&A in Central and Eastern Europe fell 16% in value in 2020, says CMS report
Hungarian vehicle makers hit by supply chain shortage
COVID-19 and Trump’s indifference helped human rights abusers in 2020
Polish parcel locker operator InPost soars in Euronext Amsterdam debut
Polish industrial production continues boom in December
OUTLOOK 2021 Poland
OUTLOOK 2021 Slovakia
BRICKS & MORTAR: Rosier future beckons for CEE retailers after year of change and disruption
FDI inflows to CEE down 58% in 1H20 but rebound expected
BALKAN BLOG: Only better waste management can clean rivers of trash
Pandemic pushes public debt close to 80% of GDP in Albania and Montenegro
BALKAN BLOG: Superstition and resentment surround vaccination plans
Albania needs reforms for e-commerce to thrive, says World Bank
Bosnia's exports in 2020 amounted to BAM10.5bn, trade deficit to BAM6.3bn
Bulgaria’s latest nuclear u-turn
Retailers and restaurant owners threaten protests in Bulgaria if reopening is delayed
Bulgaria's Biodit first company to IPO on new BEAM market
Spring lockdown caused spike in online transactions in Croatia
ING: Growth in the Balkans: from zero to hero again?
Labour demand down 28% y/y in Croatia in 2020
Kosovo’s biggest opposition party risks being unable to run in general election
OUTLOOK 2021 Moldova
Storming parliaments: New Europe's greatest hits
World Bank revises projection for Moldova’s 2020 GDP decline to 7.2%
Montenegro’s special prosecution probes finance minister over €750mn Eurobond issue
North Macedonia’s state-owned loss-makers await new owners
North Macedonia plans to cut personal income tax in IT sector to zero in 2023
Romanian cybersecurity company Safetech floats shares amid rising investor interest
Romania government to pursue “ambitious” timetable for justice reforms
Private finance mobilised by development banks up 9% to $175bn in 2019
EBRD and WBIF support fast broadband in rural Serbia
Slovenia plans region's longest-tenor Eurobond
Slovenian crypto payment system enters Thai market
Slovenia’s economic sentiment indicator up 2.2 pp m/m in January
Slovenia lost €10bn by neglecting wood industry for decades
D’S Damat franchise deals ‘show Turkey’s hard-pressed mall operators becoming their own tenants’
Turkey’s benchmark rate held as concerns over faltering recovery come to fore
Turkish lira breaches HSBC’s stop-loss, Turkey ETF signalling outflows
Following war with Armenia, Azerbaijan gains control of lucrative gold mines
CAUCASUS BLOG : What can Biden offer the Caucasus and Stans, all but forgotten about by Trump?
Armenia ‘to extend life of its 1970s Metsamor nuclear power plant after 2026’
OUTLOOK 2021 Azerbaijan
OUTLOOK 2021 Georgia
“Try me” not telecoms minister Iran’s president tells hardliners in internet row
Iran’s President Khamenei menaces private citizen Trump
Iran’s technology minister indicted for failing to properly implement internet censorship
No US move to rejoin Iran nuclear deal imminent, say Biden national security nominees
Central Asia vaccination plans underwhelm, but governments look unruffled
Fears of authoritarianism as Kyrgyz populist wins landslide and backing for ‘Khanstitution’
COMMENT: Mongolia is an island of democracy
OUTLOOK 2021 Mongolia
Mongolia's PM quits amid protests over treatment of mother with coronavirus and newborn baby
Mongolia's winter dzud set to be one of most extreme on record says Red Cross
Tajikistan: Writing for the president is on the wall (and then scrubbed off)
OUTLOOK 2021 Turkmenistan
Turkmenistan: How the Grinch stole New Year
COMMENT: Uzbekistan is being transformed, but where are the democratic reforms?
Download the pdf version
Some 300 CEOs of Belarus’ leading IT companies and their investors have signed a letter demanding a new election, an end to police violence and the release of political prisoners, otherwise they will take their businesses out of the country, it was reported on August 12.
Despite its image as a Soviet throwback, one of the few real successes of the Lukashenko regime has been to create a multi-billion-dollar IT industry that services the leading blue chip companies around the world. But now the leading IT firms are threatening to leave.
“Conditions are being formed in the country in which a tech business cannot function. Start-ups are not born in an atmosphere of fear and violence. Start-ups are born in an atmosphere of freedom and openness,” the letter said.
“In the near future, we will begin to observe a massive outflow of specialists abroad, the opening of offices in neighbouring countries, a slowdown in the growth of the IT sector, a decrease in investment in Belarusian IT companies, and a decrease in tax revenues. There is a risk that in a short time all the achievements in the field of high technologies will be cancelled out,” it continued.
The IT bosses went on to make four demands:
Altogether more than 700 tech CEOs and IT industry employees put their names to the letter.
The business has grown out of the high technology park (HTP) in Minsk that was established in part by presidential candidate Valery Tsepkalo, who served as Belarus’ ambassador to the US before becoming a technology advisor to Belarus President Alexander Lukashenko. After he left public office, Tsepkalo carried on advising governments on IT issues before entering the presidential race.
The HTP came about after Tsepkalo visited Silicon Valley whilst ambassador and returned to Minsk determined to create something similar at home. He tied up with the founders of EPAM, a leading Belarusian software engineering firm, that was already making millions of dollars a year from software exports both east and west. EPAM needed staff and was keen to build a park to train new engineers and create an ecosystem for start-ups and other projects.
Since then, EPAM has listed on the NYSE and has built up a billion-dollar business that is run out of New York, but the larger part of its engineering staff remains in Minsk.
Indeed, the HTP has been so successful that there are plans to build a series of similar parks in various Belarusian regional cities.
Thanks to the traditional emphasis on hard sciences in higher sciences, and especially mathematics, Belarus has a wealth of highly talented and hard-working software engineers. Moreover, its geographic location allows it to cater to clients in the US, all of Europe and in Asia, as the working day in Minsk overlaps with all these markets. But 90% of the exports go to the EU and the US markets.
IT exports has become a serious business for the Belarusian economy. The HTP exported $1.4bn worth of software in 2018, up by 38% from the year before, BelTA reported in March – a target the park was only expected to hit in 2020.
“The export growth surpassed all our expectations. The projections made by leading agencies were also beaten. Naturally, this is a direct consequence and an obvious success of the ordinance passed by our head of state. This success belongs not only to the Hi-Tech Park, but also the entire country. Belarus is indeed turning into one of the most powerful IT clusters of the whole of Eastern Europe,” Vsevolod Yanchevsky, director of the state institution Hi-Tech Park Administration, said.
Today the HTP is home to 267 companies and over 45,700 people were working there in 2019.
EPAM has also been doing well. It just reported its second-quarter financial that were well above consensus, as if anything, its business has been boosted by the coronacrisis.
“EPAM’s 2Q20 revenues increased 15% year on year to $632mn and came in 6% above consensus and 5% above our forecast. The number also significantly exceeded the company's guidance of $590-605mn,” BCS Global Markets said in a note on August 7. The growth was primarily driven by the strong performance of the Business Information & Media vertical (+43% y/y), Life Sciences & Healthcare (+16% y/y) and Software & Hi-Tech (+13% y/y).
However, most investment banks have marked its stock to hold or sell after the share prices rallied strongly this year and are now trading at just short of its 52-week high of $314; it shares are valued at a price-to-earnings ratio (p/e) well over 40.
EPAM is not the only company that makes use of the country's deep pool of IT talent. Minsk is one of the strongest players in the business and holds its own against rival IT hot hubs such as Bucharest, Kyiv and St Petersburg, along with several Russian regional cities.
The companies are annoyed, as Lukashenko has been blithely shutting off the internet every day at around 7pm as the street protests start to prevent the crowds from co-ordinating via social media.
The internet outages during the protest are costing the IT businesses $56.4mn per day, according to netblocks.org, and these costs are likely to soar if the protests drag on.
Already increasingly short of cash after Russia began to reduce its energy subsidies as part of its so-called tax manoeuvre, Lukashenko can ill afford to wreck one of the country’s best, and fastest growing, export orientated industries.
here to continue reading this article
and 5 more for free or purchase
12 months full website access including
the bne Magazine for just $250/year.
Register to read the bne monthly magazine for
Password could contain only
and have 8-20 symbols length.
Please complete your registration by confirming your
A confirmation email has been sent to the email
address you provided.
can't be empty.
No user with
this email address.
Access recovery request has expired, or you are using
the wrong recovery token. Please, try again.
Access recover request has expired.
Please, try again.
To continue viewing our content you need to complete
the registration process.
Please look for an email that was sent to
with the subject line
"Confirmation bne IntelliNews access". This email will have
instructions on how to complete registration
process. Please check in your "Junk" folder in
case this communication was misdirected in your
If you have any questions please contact us at email@example.com
Sorry, but you have used all your free articles fro
this month for bne IntelliNews. Subscribe
to continue reading for only $119 per year.
Your subscription includes:
For the meantime we are also offering a free
digital weekly newspaper to subscribers to
the online package.
Click here for more subscription options,
including to the print version of our
flagship monthly magazine:
Take a trial to our premium daily news
service aimed at professional investors that
covers the 30 countries of emerging
For any other enquiries about our
products or corporate discounts please
contact us at
If you no longer wish to receive
Magazine annual print
Website & Archive
Combined package: web
access & magazine print
Take a trial to our premium daily news service
aimed at professional investors that
covers the 30 countries of emerging Europe: