The FINANCIAL -- The President of the European Bank for Reconstruction and Development (EBRD) Sir Suma Chakrabarti said on Thursday that modernising and reforming Ukraine’s institutions and ways of governing had required political courage over the last four years.
In a panel discussion with Ukrainian President Petro Poroshenko during the World Economic Forum in Davos, Sir Suma said there should be no let up now in continuing with the drive for better governance even with elections approaching in 2019, according to the EBRD.
“The assault on vested interests must continue,” he said. “You have shown you have the courage to do this,” he told the Ukrainian leader.
Speaking as the head of the largest single investor in Ukraine, the EBRD President said: “We will support you in this endeavour.”
The EBRD has invested a total of €12 billion in Ukraine since the start of operations there 25 years ago. Some €3.5 billion of this amount has flowed to the country in the last four years, Sir Suma noted.
The EBRD President said the EBRD had backed its investments with support for reforms. With the support of the European Union, the EBRD had introduced reform support teams into key ministries.
The Bank was also helping to transform the energy group Naftogaz into a company that Ukraine can finally take pride in.
Sir Suma told the audience at the event at Ukraine House in Davos, that the EBRD’s work aimed to strengthen Ukraine across a number of key areas, making the economy more resilient, competitive, greener, more inclusive, more integrated and better governed.
The EBRD President highlighted progress in these areas. A financial sector clean-up, and consolidation and recapitalisation had made Ukraine’s banks more resilient, while the energy sector had benefited from the diversification of gas imports and reforms.
There had been progress on competitiveness, but more could be achieved if state-owned enterprises had less of a grip on the economy.
He noted Ukraine continued to be one of the world’s most energy-intensive countries, three times more so than the EU average, and he said the country should focus on energy efficiency, diversifying energy sources and improving municipal services and infrastructure.
The EBRD praised the Ukrainian Health Ministry’s recent steps to remove discriminatory conditions for women’s employment. But he said Ukraine needed to do more to encourage a generation of women to attain technical qualifications relevant to high-value sectors.
The EBRD President referred specifically to the need for further improvements in governance. Progress had been made but corruption was still a barrier to foreign direct investment, he said.
The establishment of anti-corruption institutions could make an important contribution to increasing transparency in the economy.
The EBRD had been happy to contribute to this with its support for the creation of a Business Ombudsman, an office which provides a forum for companies to challenge unfair treatment.
It would be particularly important to create an anti-corruption court that met the very international standards that Ukrainians were so keen to attain, the EBRD President said.