Naturally, an internal assessment or audit is necessary. In this respect, the opinions of domestic advisers, business community, and members of civil society are always very important for the country, as without them we cannot move forward.
How something should be implemented or how to combine different views is a valued skill, especially when making an important political decision. But no internal audit can provide an absolutely objective picture of the state of affairs. Therefore, an external assessment conducted by international partners like the International Monetary Fund, the World Bank and other international organizations or individual advisory groups should always be taken into account to make corrections to plans, if there is a plan, and especially during the phase of implementation.
Here is one example. The national program of reforms for 2012 contains plans for significant changes on how health care in Ukraine is provided. The healthcare system is one of the most difficult for any politician to change anywhere in the world.
Firstly, these changes usually aren’t very politically acceptable by a sensitive public. In some sense their introduction is a test for a politician. Anybody who takes even tiny but successful steps forward should be commended personally.
Many changes we have started in this sector are based on consultations with international organizations and international advisory groups, including the World Bank. However, the point is to make a rough plan, and ensure it sets off in the right direction. This, of course, is very important as a starting point of any reform process.
But details usually are even more important. In Ukraine, people think implementation is lagging behind drafting a good reform plan. It’s a very difficult stage not only for politicians, but for other parties involved, such as the Ukrainian Association of Doctors, or our international advisers and colleagues from the World Bank, because a lot of flexibility is needed, but not too much because otherwise there is a danger of getting off track.
With healthcare reform, we got slowed down at the stage of producing concrete solutions for regional problems. At the moment, our World Bank advisers are going to pilot regions where medical reform is tested – Vinnytsia, Dnipropetrovsk and Donetsk. This pilot stage will last through 2014, but the World Bank experts are gathering information for correcting the implementation strategy.
The same tactic we would like to apply to changing the business environment. Our geopolitical choices won’t matter if the country makes every effort to provide a fair playing field for business, including international business operating here.
For Ukraine, the choice is greater than two major geopolitical vectors, East or West. Why? Because according to our statistics, Ukraine’s exports to the CIS countries account for 37 percent of the total, to Europe 25 percent of the total, and to Asia – another 26-27 percent.
This means we have to have good and fruitful relations with any country and any direction worldwide. In my personal opinion, Europe remains important for Ukraine for one simple reason: because if we sign a free trade agreement, which is a part of association agreement, we will import, among other things, new business technologies, new managerial technologies and new international standards of conducting business inside the country.
There are at least four countries, Czech and Slovak republics, Poland and Lithuania that support signing an association agreement with Ukraine as early as possible next year and that is a good sign.
Deep and comprehensive free trade area, is a very important basis both for Ukrainian business to advance abroad, and for our international partners to feel more comfortable inside Ukraine.
At the same time, Ukraine strives to have good cooperation with partners from CIS countries and a free trade agreement that was ratified this year is very important for Ukraine. This is especially so for industrial producers.
I’m very far from saying that this is enough. We should certainly not rest on laurels. Nevertheless, Ukraine’s advancement by 15 points in the last Doing Business ranking, and by 9 points in the Global Competitiveness ranking prepared by the World Economic Forum indicate means that we’re moving successfully in the right direction.
But such improvements often carry risks of rollbacks, too. For example, in recent years we have reduced by 90 percent the number of permits and licenses required for conducting business. But in the last few days of the work of parliament we have seen a number of draft laws on the agenda that are attempting to restore the rules of the past. Some of them suggest giving back the lost powers to control bodies, so that they can intervene in business operations.
This is just one example to illustrate that liberalization of the economy is a very difficult process. On one hand, there is political will to do it. On the other, there is huge resistance of behalf of those profiteering from creating barriers and controls.
I am proud that despite this pressure, Ukraine has been making successful steps towards improvement of the business environment. I am grateful to all international and domestic advisers and organizations who took part in creating the national plan of reforms, and the action plans that followed.
I cannot promise that criticism will be incorporated into the national action immediately because politics is complicated. But I am absolutely sure that it will help to implement the national plan of reform even more successfully with their help next year.
Iryna Akimova is senior adviser on economy to President Viktor Yanukovych.
