Alexander Bornyakov (Photo: press service)
Alexander Bornyakov Deputy Minister of Digital Transformation, Project Manager Diya.City
This year, Ukraine not only strengthened existing areas of work, but also focused on the development of new technological areas that are relevant in modern realities. More details can be found in the column of Deputy Minister of Digital Transformation, head of the Diya.City project Alexander Bornyakov for RBC-Ukraine.
About defense-tech
Our priority in 2023 is projects aimed at technologically strengthening the Ukrainian army. After the full-scale invasion, Ukrainian developers began to actively generate combat-ready and competitive defense solutions. Realizing how strong an impact they can have to bring victory closer, the Ministry of Digital Development, together with the Ministry of Defense, the General Staff, the National Security and Defense Council, the Ministry of Strategic Industry and the Ministry of Economy created the Brave1 cluster – a platform that united all stakeholders of the defense-tech sector – business, government and the military – and became a platform for the development of breakthrough Ukrainian-made defense technologies.
Currently, more than 900 developments are registered on the platform, 423 of which received BRV1 status, that is, a high and average rating from General Staff experts. This means that these solutions are of interest and priority for the Security and Defense Forces and receive full support from the cluster, in particular financial, organizational and informational. In just 8 months of operation, Brave1 financed 137 developments for $2.325 million.
The cluster presents completely different defense technologies – unmanned aircraft and robotic systems, developments in the field of electronic warfare/electronic warfare, AI solutions, technical equipment for reconnaissance, navigation and geographic information systems, missile and artillery fire destruction, robotic and remote-controlled installations, naval drones and etc.
Some of the most iconic and well-known products that Brave1 works with include the Saber Turret and the Lynx Remote Control Platform. And also an invisibility cloak that masks our military from Russian thermal imagers and drones with thermal imaging cameras. These technologies are already actively used on the battlefield and save the lives of our defenders.
About Diya.City
Throughout the past year, the Diya.City space continued to develop and be replenished with new residents. During this time, 370+ companies joined it. These are powerful international and Ukrainian players – ELEKS, Avenga, Nokia, Quantum Systems, Uklon, Vodafone, Nova Poshta and others. Therefore, in general, more than 760 residents, employing more than 60 thousand people, are now using the space conditions.
We are now focused on ensuring that more technology companies have the opportunity to operate and grow within the space. This is especially true for defense-tech. Therefore, we previously provided this opportunity to companies involved in the development and production of air, water and ground drones, their maintenance and repair, training in drone management and aerial reconnaissance. In total, more than 80 companies are already operating in Diya.City, creating drones, works and other defense innovations.
For such companies, residence in Diya.City is an opportunity to build a transparent and effective corporate structure, which is very important for attracting investment. In addition, a powerful incentive for scaling a business is the NnVK, which operates within the space and allows residents to reinvest funds in development. There is a case when one of the powerful companies of the defense-industrial complex, after a year of work at NnVK, accumulated a budget and built its own R&D center.
On the development of the startup ecosystem
We have set ourselves a goal – to increase the number of startups per million people. To do this, we work along 3 main tracks.
The first is the formation of a culture of technological entrepreneurship among schoolchildren and students. So that after graduation or even in the process of receiving education they have the appropriate skills and can create their own business project. The second is the creation of acceleration opportunities. To do this, we are launching various programs together with businesses and talking about attracting organizations such as Techstars, Plug and Play, Alchemist Accelerator to Ukraine.
And the third, perhaps the most important, is simplifying access to investment and grant opportunities. We continue to work to unite international investment funds with the idea of supporting the Ukrainian digital economy. Our goal is to raise about $200 million for Ukrainian startups. Now, not counting the defense-tech sector, there are already 4-5 large funds created exclusively to support Ukrainian startups.
The Ukrainian Startup Fund is actively working in this direction. He is the largest angel investor in the country. For 2023, the fund's support for startups and projects is about $2.7 million as part of the implementation of major grant and partnership programs.
About artificial intelligence
This year, artificial intelligence has become the number one topic around the world. Ukraine, as a technological state, also does not stand aside from this trend and is actively strengthening its position in the development of AI, as well as integrating it into all spheres of life – from business to public administration.
In 2023, we presented a roadmap for the regulation of artificial intelligence in Ukraine, which describes our vision for the implementation of national legislation in the field of AI. Dorcard is based on an approach that we call Bottom-up, that is, movement from the bottom up. This means that the government will first provide businesses with all the tools to prepare for national regulatory requirements, and only after that will introduce legislation on artificial intelligence.
This approach will help companies adapt their AI products in advance to future Ukrainian regulatory requirements. It is important that our standards will be synchronized with European requirements. This will allow Ukrainian companies to easily enter international markets in the future, when Europe adopts its own legislation in the field of artificial intelligence.
About Ukrainian e-residency
In December, we launched beta testing of uResidency, a Ukrainian e-residency program, thanks to which citizens of other countries will be able to register individual entrepreneurs in Ukraine and conduct business from anywhere in the world, paying taxes to our budget.
This program will be a powerful source for the recovery of our economy through taxation of foreign entrepreneurs, and will also strengthen the brand of Ukraine as a digital state.
uResidency focuses on small business owners from Asia and Europe, particularly IT professionals and online service providers in the creative economy. Early next year, the program will become available to citizens of the first four countries – India, Pakistan, Thailand and Slovenia. As the program rolls out, this list will expand.
About virtual assets
At the beginning of the year, we launched a free educational course on cryptoliteracy and blockchain on Diya.Osvita, which has already been joined by 21,000 Ukrainians. Together with colleagues from the Legal Policy Committee, we worked on the concept of a “digital thing,” a type of which is crypto-assets, and this is already enshrined in the Civil Code. To determine the needs of crypto business in our country, we initiated and presented the WEB3 study for Ukraine: dialogue with founders. 50 web3 entrepreneurs took part in it. We will take into account the results of this study when forming and implementing state policy in the field of digital economy, digital innovation and technology in Ukraine.
Also this year, an alternative bill No. 10225-1 “On amendments to the Tax Code of Ukraine and other legislative acts of Ukraine on the regulation of the turnover of virtual assets in Ukraine” was registered. The main goal is to launch an effective crypto market and introduce clear rules for taxation of transactions with a new class of assets.
About plans for 2024
Defense-tech will be our constant priority for a long time. Next year we plan to create an Army of Robots and an Army of Electronic Warfare as part of Brave1, so that even more effective solutions that save the lives of our defenders become available on the front lines.
Creating a better environment for the technology sector is another important area of work. We will continue to work to ensure that the company has all the opportunities for development and scaling in our country, so that unicorns are born here, and global technology giants enter Ukraine. I am confident that the Ukraine of the future is a successful technological state, a country of innovation, where it is profitable and promising to build a business.
There are also plans to launch a regulatory sandbox for high-tech startups working in the field of web3 and AI. Within this environment, companies will be able to develop and test their products in accordance with future legislation, while receiving full support from the government.
Next year we will continue to boost the development of artificial intelligence. We plan to develop a White Paper, formulate general and sectoral recommendations for business, and launch a course on AI for medical students. In addition, we will work on Government BI – a system for making informed management decisions based on Big Data and AI. There are also plans to create a hub for international GovTech developments in order to exchange experience with other countries and scale successful solutions.