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Urgent Reforms Needed in Ukraine
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Kyiv, Ukraine, April 2009-Ukraine, hard hit by the economic slowdown, needs to enact major reforms to avoid further economic deterioration, a new report says. According to the Blue Ribbon Analytical and Advisory Centre report, overdue state reforms are needed to promote economic growth and improve standards of living. “Ukraine is one of the worst-hit countries by the economic slowdown in Eastern Europe due to the sharp decline in demand for metallurgical and chemical products in the global market,” United Nations Development Programme Deputy Director, Cihan Sultanoglu, said. At the moment, unemployment in Ukraine is projected to reach 9.5 percent in 2009, with more than 3.2 million out of work individuals turning to the state for help. Additionally, in mid-December the International Monetary Fund lowered the forecast for Ukraine’s GDP in 2009 from a 2.5 percent growth rate to a 5 percent decline. The figures are a result of Ukraine’s vulnerability to the economic crisis. Decline in industrial production, loss of external markets, energy supply and price problems and tougher lending conditions have all contributed to this vulnerability. “It is vital to analyze the recent achievements and shortcomings and revisit the agenda of national human development priorities,” Ms. Sultanoglu said. The report, sponsored by then UNDP and the European Commission and written by an independent panel of experts, outlines those priorities, including:
In addition, the report recommends ensuring macroeconomic stabilization, bolstering market institutions and improving Ukraine’s integration into the world economy. Pursuing such policies and improving government accountability will also help Ukraine, which has an annual GDP of $6,900, better align itself with its western neighbors, the report says. At the moment, Ukraine’s primary trading partner is Russia. “These new recommendations are intended to help the President, the government and Verkhovna Rada to shape policy in coming months and also to give Ukrainian society a useful tool to monitor reform progress in key areas,” Acting UNDP Resident Representative, Joanna Kazana-Wisniowiecka, said. “UNDP stands ready to support these efforts in order to promote sustained economic growth and thus even out regional disparities in Ukraine and close the income gap between Ukraine and its western neighbors.”
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