When I talked to a friend in Belarus last night he pointed me to President Alexander Lukashenko’s initiative: The High Technologies Park. Belarussia is lying in the heart of Europe and Western media calls it a dictatorship, because of its autocrat president and the lack of democratic elements, such as free elections. The government is known to crack down hard on opponents of its political course and Lukashenko is often in the news for funny (for us Westerners) but sad new laws such as the ban of foreign music on the Belarus radio stations. They now have to play 80% of Belarusian music. He has also been in the news for other initiatives, like trying to keep Belarusian girls in the country with force. Many of them were trying to flee as mail-order-brides or “models”, but Lukashenko claims that they are the most beautiful in Europe and so the treasure needs to stay at home. Belarus is a large, rather poor country and some of my Russian friends refer to it as: Do you remember the pictures of Russia in communism? It’s still like this in Belarus.
Valery TSEPKALO, is an adviser to the President of the Republic of. Belarus and seems to like to read books. In an interview about the “techno park” with Belarusian BYBanner he tells us about the value of intellectual property and that it can be worth $10 000 or be worth $350 Million like the Harry Potter Book, no matter how high the production cost was. He then claims that it is essential for companies to get highly skilled experts, like programmers for a lower cost and create the right environment for the company (e.g. tax breaks) to maximize profits. It seems he has read the recent publication of Pulitzer price holder Thomas L. Friedman: The World is flat. In his book Friedman takes a closer look at outsourcing and especially outsourcing to 3rd world countries such as India.
India has recognized its people’s potential and created such techno parks in cities like Bangalore. Today there are many offices of Indian, but also multi-national companies in these areas. They do not only provide programming services, but services in general. From accounting to call enters. Mc Donald’s actually runs a call enter in India that does the work for the drive inns in many US restaurants. India attracts companies with tax reduction and special high tech infrastructure (like broadband Internet and Communication lines), but the biggest benefit is the low labour cost. Another benefit to US and UK companies is, that English is a fluently spoken second language for many Indians, since the English occupied the country as colonialists. Nevertheless, and I know that from my own experience, outsourcing isn’t easy. It brings a whole bag of problems and often you end up loosing your cost advantage, because things just get out of control and you are too far away to fix the problems. It gets worse, if you work with a country other than India, that doesn’t have English as a second main language and in any case you have to deal with great cultural differences.
So what is Belarus planning on offering to compete against countries like Russia, Ukraine and India in outsourcing of hi-Tec services? Belarus runs this initiatives in 2 different ways, it offers tax reduced zones (like free trade zones), along with the right infrastructure. Offices in these zones are supposed to be with reduced rent and better conditions than elsewhere. The second way Belarus looks at it, is that no matter where you locate your company you’ll get these tax breaks and other advantages, even if you decide not to settle in a pre-defined park. Belarus not only looks at Bangalore, but also at the Silicon Valley as a role model for its new high technology park. Besides tax breaks, the government is working on special risk investment laws to support VC money that should flow from the outside into high tech start-ups. The park is more than an idea already. Apparently more than 45 companies are involved in financing and building this park and so far there was no government, but only private investments made. Five of these companies are supposed to be world level and are from Great Britain, Israel, Austria, Belgium and Italy. Besides, Deloitte & Touche was hired to make strengthen the concept and make this idea a reality. In March-April they offer to allow registration for the first tenant of the Belarus High Technologies Park.
Where there is much euphoric by the makers there are (of course) also critics. Its in the nature of Belarus that the voices of critics are hard to find and made silent soon after they surfaced. The internet gives a little more opportunities to go around the governmental censorship. But, one doesn’t have to search and read long articles on the Internet. The obvious downturns and risk are visible even without being discussed in detail. One is the censorship itself. Internet-Traffic and other private communications are screened and its just not what high-tech companies like. Why, apart from being spied on personally? A high technology company main asset is its technology and it should net get into somebody else’s hands. This is also a problem in China. Another problem is the bad connection to the global network. I work with people in Belarus and their connections are often down or very slow. Most critics doubt that there will be a huge advantage in labour cost compared to Russia or Ukraine. Programmers in St.Petersburg, Moscow and other large cities may be more expensive, but the salary and cost level is lower in the some smaller cities in the regions.
Most of all I doubt that foreign corporations have much interest in Belarus as long as it is closed and isolating itself. Media companies like the German Bertelsmann sponsor think tanks to work on concepts on how to change the government (to say it in a nice way) and create a better investment environment. Western Governments actively support these initiatives and the heavily suppressed opposition in this Belorussia. On top of it, is feared, that Lukashenko is not giving up presidency as peaceful as Kuchma did it in Ukraine. Observers expect fighting and violence before and while the next elections, which is also not a good lookout into the future and to secure nowadays investments.
In the project:
1. Groups of the institutes of the National Academy of the Sciences
2. the scientific research housing
3. center with the universal hall for conducting the conferences
4. group of the institutes of the National Academy of the Sciences
5. the hotel complex
6. office building - representation of the firms
7. the scientific research housing
8. office building - representation of the firms
9. the scientific research housing
10. the scientific research housing
11. accomodations of the maintenance
12. the habitable complex
13. apartment house with the vstroenno- attached accomodations of the maintenance
14. Torr center
15. groups of the institutes of the National Academy of the Sciences
16. territory of the museum of the boulders
Links
What the president has to say about it
http://president.gov.by/eng/search?what=high+technologies+park
In the BY Press.
http://www.bybanner.com/show.php3?id=1721
http://www.bybanner.com/show.php3?id=1712
http://www.bybanner.com/show.php3?id=1193
http://www.pravo.by/webnpa/text.asp?RN=P30600065
Open Letter to the administration of the BY Techno Park
http://www.it-belarus.net/news/read/2005/11/45/
Official Website of the BY Techno Park
http://www.park.by/
Bertelsmann Stiftung
http://en.bertelsmann-stiftung.de/
On Amzon.com:Thomas L. Friedman - The World Is Flat
Auf Amazon.de: Thomas L. Friedman - The World Is Flat
June 14th, 2007 by 
Two-Zero 
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