Ukraine has risen four places in the World Bank's Doing Business rankings, and now stands at 83rd out of 189 countries, according to the bank’s latest business survey, which was released late on Oct. 27.
But compared with its former Soviet
neighbors, Ukraine’s performance is still less than impressive: the Baltic
states rank between 16 and 22; Georgia remains at 24; Kazakhstan jumped 12
places to 41; was Belarus down one place to 44, while Russia has gone up three
spots, to 51.
The only former Soviet countries that rank
below Ukraine are Uzbekistan and Tajikistan – widely viewed as two of the most
repressive countries in the world.
At the Orchestrators of Change conference
on Oct. 29, Kyiv’s business community expressed their disappointment that the
government has not done more to meet the criteria, while also trying to remain
positive.
“Just four positions, my friends, doesn’t
mean anything,” Oleg Utsenko, the executive director of the Bleyzer Foundation,
told conference-goers.
Speaking
about world investment trends, Utsenko told the room packed with businessmen
that right now Ukraine needs to appear as attractive as possible: “Investor
attitudes have changed. They’re scared… This means less money for developing
markets. Less investment and bigger demand means there is more competition to
attract investors.”
Ukraine saw its best improvements in the “Starting
a Business” category, where it rose 40 places. According to the World Bank,
this was achieved by “reducing the time required for VAT registration and by
eliminating business registration fees.” But other areas have seen almost no
improvement.
“Ukraine has gone up in the rankings for
opening a business. But you understand that this is just the first stage,” Rufat
Alimardanov, the regional head of the IFC in Ukraine and Belarus, said at the
conference on Oct. 29.
However, Alimardanov remains optimistic
that Ukraine can improve a lot over the next two years, and said that this
might not be as difficult as it seems at first glance.
For instance, the “Getting Credit” category
does not assess how easy it easy for someone to get credit in Ukraine – rather
it’s about the procedure in place to do so. After all, as Alimardanov noted,
“no one is really getting credit in Ukraine at the moment.”
Or to take another example: It takes
businesses in Kyiv an average of 263 days to get hooked up to the electricity supply
from the time of submission of their the application. This is compared to 77.7
in OECD high income countries, or an average of 118.5 in other European and
central Asian countries.
The dire need for improvements in the
energy sector was noted by Prime Minister Arseniy Yatsenyuk at the same cabinet
meeting. He placed the blame for Ukraine being “pulled down” in the rankings
entirely on the National Commission on Energy Regulation and Utilities and the
Ministry of Energy and the Coal Industry for failing to de-monopolise the
energy sector.
The results are well below the 25 place
climb predicted in March 2015 by Ukraine’s minister of economic development and
trade, Aivaras Abromavicius. But instead of back tracking, Abromavicius told a
cabinet meeting on Oct. 28 that in two years’ time Ukraine would be in the top
50.
Andrey Bespyatov of Kyiv-based investment bank
Dragon Capital said such a goal was realistic
“Given that Ukraine placed 150 or so just five
years ago, it is quiet achievable, but it all depends on the criteria and
whether the government approves new legislation,” Bespyatov said.
Kyiv
Post staff writer Isobel Koshiw can be reached at [email protected]
