REFORM PROGRESS IN UKRAINE

Industrial production dropped by 20%
About $ 200 mln monthly

spent providing
utilities to the occupied territories
GDP dropped by 17-20% due to war and
annexation of Crimea

Military aggression by the Russian Federation
Military budget reached 5% of GDP in 2016 or UAH 113.6bn.
Six times more than in 2013.

Price drop for key Ukrainian exports
Export revenue in 2015 fell by
$25 bn (-39%) vs. 2013

Energy aggression by the Russian Federation
Damage from loss of energy facilities in Crimea is
estimated at hundreds of billions dollars

Trade and economic aggression
of the Russia Federation
Revenues from export to Russia
reduced by $1-1.2 bn annually

Hybrid war
Ukraine became target for testing
new forms and technologies for aggression

Information war
Large-scale information war launched by the
Russian Federation inside and outside of Ukraine

to external aggression
Foreign direct investments in Ukraine decreased by

$13.7 bn during 2014-2015

Political and government changes
Parliamentary elections, local elections and several government changes took place over the two last years

Ineffective system
of the state governance

Terrorist attacks and
sabotage activities
on the territory of Ukraine

Exhausted financial and
banking systems
Banking system lost UAH120 bn
during 2014-2015

Corruption in the state system
Broad corrupt practices across state institutions
Volume of investigated corruption cases during
2015 grew 35 times (est.value UAH 3 bn);
UAH 1 bn is investigated by the
National Anti-Corruption Bureau

Inefficient law
enforcement and
judicial systems

experienced such stress–factors as Ukraine.

2004
Admission to EU
After "Solidarity" secured parliamentary elections, an expert committee

headed by Leszek Balcerowicz was created in September 1989. The committee prepared reform plan for rapid transition of the Polish economy from planned to free market.

Singapore was so economically underdeveloped that it was necessary to

import fresh water and cement. Neighboring countries were unfriendly. Malaysia closed its market for Singapore, and Indonesia actually declared war.

growth
Before the 2004 elections, Georgia was a half-collapsed state in

deep economic turmoil. Over the next few years the new cabinet conducted extensive and effective changes.

the government. Main sectors of Slovakia’s reforms were: public finance,

tax and pension systems, health care, labor market and local government.
Fiscal incentives became the main instrument of the reformers’ policy. In the area of public finance, Slovakia strengthened budget transparency, implemented program funding, and planned three years ahead (versus one).

1998
Beginning of reforms

2004
First results and
admission to EU

2008
Progress identified

2012
Stabilization

of security and defense sector development (March, 2016)
State targeted defense

program on weapons and development of military equipment by 2020 (March, 2016)
Strategic Defense Bulletin (May, 2016)

PERSONNEL:

Total personnel increased to 250,000 people
Over 52,000 people signed up for contract-based service
150 new recruitment centers are opened
Established: 15 brigades, 1 regiment, 5 separate battalions
115,000 people have been trained in higher military educational institutions
Fully restored combat capability of 14 brigades and 60 battalions

REFORMED:

Reforms started in the Ministry of Defense, General Staff, Armed Forces (aligned with NATO standards and approaches)
Logistic on NATO standards
Electronic procurement system ProZorro saved over UAH 180 mln

DEFENCE AND FACILITIES:

Defensive fortification line include 220 km of artificial obstacles and more than 500 command centers
1,400 hectares of lands and 21 valuable real estate properties returned to the Ministry of Defense under anticorruption program

Ukraine Association Agreement ratified by 28 EU member states in

a year. Finalization of ratification process by the Government of the Netherlands is pending

Strong international pro-Ukrainian coalition formed

Ukraine met all EU requirements for visa-liberalization

Launched biometric passports for international travel of Ukrainian citizens

Opening European markets for Ukrainian companies, overcoming consequences of Russian embargo

DEREGULATION

Ukraine went up from position 112th (2013) to 83rd (2015) in Doing Business rating

More than 15,000 Soviet standards abolished

About 100 administrative barriers for business canceled

Quantity of permits cut from 143 to 84

List of activities that are subject to licensing decreased from 56 to 30

Electronic licensing introduced

Deregulation in agricultural sector: 28 permits cancelled, 28 simplified

The number of scheduled and unscheduled State Fiscal Service inspections decreased almost by half in 2015 compared to 2013

2014 key anti-corruption laws on new anti-corruption institutions were adopted

National

Anti-Corruption Bureau (NABU) was formed and started investigation.

Specialized anti-corruption prosecutor's office and the National Anti-Corruption Policy Council were established.

Based on the results of the open competition four members of the National Agency for Prevention of Corruption (NAPC) were elected.

State Bureau of Investigation and the National Agency for Identification, Tracing and Management of Assets Derived from Corruption and Other Crimes were legislatively established.

Legislative Acts concerning Fight against Political Corruption and Financing Political Parties were adopted.

Property registers became publicly accessible.

LAW
ENFORCEMENT

Police patrol has been launched in 32 cities, and staffed by over 12,000 persons

The Law "On the National Police" adopted.

Prosecutor’s office was deprived of powers of general supervision, and the new Law “On the Prosecutor’s Office” adopted.

The number of local prosecutor’s offices reduced by 23%, and administrative staff - by 75%.

The process of establishing the State Bureau of Investigation started.

JUDICIAL
REFORM

Amendments to the Constitution regarding the administration of justice and the implementing the Law on Judiciary and Status of Judges were adopted

Law "On Ensuring the Right to a Fair Trial" adopted.

New rules introduced: evaluation of the performance of judges, maintenance of judicial dossiers, qualification of examinations; new professional and ethical requirements

The legal basis for the new European, open and competitive

gas market established.

Significant diversification of gas supply sources. The volume of gas imports from EU increased from 8% in 2013 to 63% in 2015, Russian share reduced from 92% in 2013 to 37% in 2015.

Agreement with alternative suppliers of fuel for nuclear power plants signed.

Deficit of “Naftogaz of Ukraine” decreased from $ 8 bn to $ 1.5 bn in 2015; zero deficit projected for 2016.

Utility rates have been adjusted to the market level.

Western standards of the corporate governance have been implemented in “Naftogaz of Ukraine”

“Naftogaz of Ukraine” supervisory board (5 members) appointed (3 - independent members)

DECENTRALIZATION


Voluntary merger process was initiated in more than 6300 territorial communities; 159 capable communities formed.

Communities obtained additional financial resources as a result of financial decentralization.

Local government revenues increased by UAH 29.6 bn. (i.e. 42.1% ) in 2015 vs. 2014.

PUBLIC PROCUREMENT


Online system ProZorro became a cornerstone for optimizing government procurement and preventing corruption: 4,500+ contractors; savings exceed UAH 1.2 bn.

ProZorro received World Procurement Award 2016.

Ukraine joined WTO Agreement on Government Procurement, enabling access to public procurement markets of 48 countries (est. $ 1.7 trillion).

and administrative roles in public service.

Quantity of public servants

was reduced by 16%.

Updated State Portal for Administrative Services launched (poslugy.gov.ua).

Ukraine’s public sector efficiency indicator (Global Competitive Index survey) increased from 140th (in 2013) to 119th (in 2015).

STATE-OWNED
ENTERPRISE GOVERNANCE

For the first time financial statements of 780 state-owned enterprises (SOEs) had been published.

345 SOEs were approved for privatization.

Mandatory sale of 5 - 10% of shares before the auction was canceled.

Changes to the Law on JSC shareholders’ meetings decreased quorum requirements from 60% to 50% + 1 share.

For the first time international audit companies will audit 150 major SOEs.

For the first time reports on the top 100 state-owned enterprises have been published.

Market level compensation for the CEO’s of state-owned enterprises has been introduced.

For the first time special independent committee was established to select CEOs of 12 strategic enterprises (Ukrgasbank, Ukrgazvydobuvannya, Sumykhimprom and others). Eight of them had already been appointed.

Corporatization of the state railway company “Ukrzaliznytsia” started.

fees was cut from 22 to 11.

Electronic VAT administration

system introduced.

Employer’s social payroll tax rates has been reduced from 41% (2014 average) to 22% in 2016.

Experiment on financing road construction and development from the surplus of customs duties has started.

Ukrainian foreign debt of more than USD 19.4 bn. was restructured.

The Law "On the Accounting Chamber" adopted.

Ministry of Finance launched E-data portal for monitoring public finance.

FINANCIAL SECTOR


78 insolvent banks were closed during 2014 - 2016; over UAH 70 bn of deposits returned to customers by state.

Budget deficit reduced from more then 11% (2014) to 3% (2015).

Macroeconomic situation in the country stabilized.

Е-GOVERNMENT AND
INNOVATIONS

3G introduced in 2015 (budget gained UAH 11 bn via transparent tender).

Open data portal - launched.

Electronic petitions to the President of Ukraine - launched. More than 21 000 petitions are registered YTD.

Other electronic services have been introduced including electronic apostil and access to public registers of the Ministry of Justice.

has been enhanced.

Launched “Go Global” - national initiative to

promote learning English and other foreign languages across Ukraine.

Ukraine joined EU framework programme for research and innovation “Horizon 2020” (€80 bn).

Ukraine will be enrolled in Programme for International Student Assessment (PISA) in 2018.

Ukraine joined EU framework Programme “Creative Europe”

SOCIAL AND
POLITICAL AREA

New national holidays: the Day of Defender of Ukraine (October 14), the Day of Remembrance and Reconciliation (May 8).

Established celebration of the Day of the Heavenly Hundred Heroes (February 20) and the Day of Freedom and Dignity (November 21).

Decommunisation started (979 towns and cities, and 24 districts were renamed).

More than 1000 monuments of Lenin and over 150 monuments of other Soviet figures were demolished.

and 100 regulations were introduced for the competitive selection of:

Director and the staff of the National Anti-Corruption Bureau

Members of the National Agency for Prevention of Corruption

Prosecutors for supervising the observance of laws during investigation and search operations, as well as pre-trial investigation carried out by detectives of the National Anti-Corruption Bureau of Ukraine

Managers and prosecutors of the Specialized anti-corruption prosecutor’s office

Members of the High Council of Justice, members of the High Qualification Commission of Judges of Ukraine, judges, court staff

Police officers

Members of the Accounting Chamber

Head of the National Agency for Identification, Tracing and Management of Assets Derived from Corruption and Other Crimes

Director, deputies and staff of the State Bureau of Investigation

Civil servants and secretaries of the state

Leaders of all important state-owned enterprises

Heads of scientific institutions, Director of the Ukrainian Book Institute, heads of state and municipal museums, libraries, cultural institutions, heads of centralized library systems, heads of administrations of historical and cultural reserves.

new principles of governance.
We do not focus on names, but

institutions.

«…Ukraine… is an example of how it is possible to reform institutions in a way allowing us to generate enormous amounts of goodwill among the Ukrainian people, because Ukrainians want to see these institutions move forward»

Geoffrey R. Pyatt,
Extraordinary and Plenipotentiary Ambassador US to Ukraine, May 16, 2016

the Prime Ministers, governments, coalition, civil society, army, diplomacy, donors,

volunteers and all citizens of Ukraine
WE ARE ABLE TO ACHIEVE SUCH RESULTS AND PROGRESS.

than other countries before.

ASPIRE FOR …