Yuriy Syvytsky, a member of the Intecracy Group supervisory board, believes that Ukraine's main task is not to keep young specialists in the country but to create comfortable conditions for doing business, so that they are glad to come back after gaining experience in the West.
How this can be achieved — on the website of the newspaper Business.
The other day I came across an article about a Ukrainian schoolboy who had invented a way to extract electricity from the air. The young Ukrainian won an American competition for young talent and received a grant to study in the US. Somehow I suspect he won't be coming back. His entirely sound scientific invention will be put into practice in 10–15 years. One of the global corporations will spend $30–40 million on research and development and go on to earn billions in profit in the energy business.
Our country, meanwhile, will keep spending billions of dollars a year importing energy resources, when for a small fraction of that money it could achieve energy independence in the foreseeable future. This case is not the only one; it is one of many.
Because young talent is not needed by its own country, we are losing competitiveness on the global market, along with tens of billions of dollars. The "Top 50 Tech Entrepreneurs of Europe" ranking includes people such as Jan Koum (WhatsApp) and Max Levchin (PayPal, Yelp, Slide and Affirm), who managed to earn billions purely through their intellect. And they keep and spend that money outside Ukraine.
Let me give another striking example. In recent years the world has been stirred by claims from scientists at the Canadian company D-Wave Systems that they have developed a quantum computer. Their brainchild has already delivered results: the computer completed a given task 100 million times faster than a conventional computer. The development has already attracted hundreds of millions of dollars in investment, and very soon we will be talking about billions.
Few people know, however, that with the right approach D-Wave could have been a Ukrainian company rather than a Canadian one. Its founder, the physicist Alexandre Zagoskin, emigrated in the mid-1990s because nobody in our country needed his project. These examples show what opportunities we are missing because of the phenomenon known as "brain drain". Is it realistic to stop it, and how can it be done?
A mutually beneficial exchange
In my view, banning Ukrainian scientists from leaving the country, as was done in the USSR, is the wrong path. Just 15 years ago we still had a chance to create technologies on our own and then earn money with them on the international market. Today, because of the heavy losses in the material and technical base of fundamental research, we can only do this in partnership with other countries.
To get a modern education and experience, young people need to travel to international events, take part in competitions and carry out joint experiments. With the right approach, our specialists working in the West (even to the point of changing their citizenship) can bring enormous benefits to Ukraine. Take India: hundreds of thousands of people from that country work in the US and Europe. When they set up startups, they then bring in their compatriots who are physically based in India. The result: the country exports $70 billion worth of IT services every year.
Granted, India has a far larger population, and there are other factors at play. But I cite this figure to show the potential of the intellectual capital of the IT industry alone. Mathematicians, chemists and physicists in agriculture, medicine and aerospace can earn even more than IT people.
The key is not to restrict talented young people from going abroad at all. Quite the opposite: it makes sense for the state to provide financial support for Ukrainians to study and train abroad. What matters is creating conditions in which already trained specialists are able and willing to work on the Ukrainian market.
If we fail to achieve this, we are dealing with a "brain drain" — as we are now. If we succeed, a mutually beneficial "brain exchange" takes place. Luring "our" people back to Ukraine from the US or another country at a similar level of development is entirely realistic. After all, first, competition here is weaker and, second, the cost of living is lower. But there are a number of factors that need to change.
A strategy for change
First, we urgently need a deep reform of education, from changing curricula to how budget funds are allocated. We need more specialization and practical training instead of producing generalists who have no deep knowledge of anything.
Instead of allocating money to universities, it would make sense to open special bank accounts for school leavers who score highly in the external independent testing. The funds credited to these accounts could only be spent on education. State-funded university places would be abolished at the same time. Inefficient universities would close because they could not withstand the competition. Institutions with high-quality programs and internships abroad, by contrast, would see their funding grow.
Second, the protection of intellectual property. In a country where the state itself is the biggest pirate, no entrepreneur whose main asset is the product of intellectual work can be sure that their development will not be stolen.
Third, attractive tax conditions for innovation. We are competing with the whole world. And if tax conditions are more favorable in Poland or the Baltic states, international corporations will order services from them. I know that the new finance minister, Oleksandr Danyliuk, opposes any tax breaks, seeing them as a source of corruption. In that case, let's set low taxes for all businesses across the board.
Fourth, we need a state guarantee that investments are inviolable. No tax official, prosecutor or other representative of the state should have the right to freeze a company's accounts on some absurd pretext. This is, in fact, the main reason why businesses keep their money and pay taxes in other countries. In parallel, we need judicial reform and an end to ambiguous wording in legislation.
Fifth, once the problems with the courts, the security agencies and taxes have been solved, we can talk about building a venture capital market. Private companies will seek out promising talent themselves, study their developments, help them with education and then make a profit from it, paying taxes into the national budget.
This is already happening — foreigners are seeking out our talented people and luring them away. But it is other countries that benefit, while we keep losing intellectual capital.