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The program of economic reform for 2010-2014 released by President Viktor Yanukovych is the first- ever governmental program suitable for meaningful debate.

It contains a clear list of actions, rather than appeals and promises. It comprehensively defines and describes the challenges Ukraine is currently facing.

However, the program has significant faults that threaten its successful implementation. The biggest one is detachment of the proposed economic reform from the system of state governance. The block of reform that deals with modernization of the state governance system (administrative reform) will only be ready in autumn this year, while the actual economic reform plan for 2010-2014 has already been made public.

Having a program for economic reform without an administrative reform is like carrying a suitcase without a handle – hard to carry, but you can’t just drop it, either. Planning a separate economic reform is senseless, since implementation is impossible without a radical restructuring of the state organs in charge of economic policy.

For example, deregulation cannot take place unless reform is also carried out of the Economic Ministry, the State Committee for Regulatory Policy and Entrepreneurship, and the State Committee for Technical Regulation and Consumer Policy.

The implementation of the president’s program requires changes in legislation, but only gives a list of draft laws planned to be adopted, rather than a realistic plan of legislative initiatives pointing out that exactly needs to be cancels, approved and changed.

The planned changes in law have no appropriate institutional and budget backing. This means that out of the three imperative components for developing a state policy (laws, institutions and financing), the president’s program only has one, the laws.

As far as its content is concerned, the program failed to become a document built along a single logic. In the description of problems and their causes, the problems are quite often just their symptoms, while what’s described as their causes is actually their effect.

The list of required steps quite often mixes changes in legislation, institutional changes, individual measures and general statements, such as “to improve/deepen/perfect” something.

The indicators of successful implementation of the program are selected quite objectively, but often there is little connection between these indicators and the tasks set by the program.

One of the big problems in the program for economic reform for 2010-2014 is the absence of priorities. It suggests 17 substantial reforms in nearly every sphere of the economy in the next five years – but it’s not realistic.

Having priorities is a necessary condition for effective tactical planning and distribution of state expenditures for the fulfillment of the program. If no priorities are set, the program simply cannot be fulfilled.


Maxim Boroda is head of the social economy program at the International Centre for Policy Studies, a think tank. More information on www.icps.com.ua.