The policy of state aid in Ukraine should be radically reformed in the light of this country's international commitments. State aid is called to help indeed, Oleh Rybachuk, chairman of the public expert council to the Ukrainian part of the Ukraine-EU Cooperation Committee and head of the NGO Center UA, said during an expert meeting at UKRINFORM.
"The policy of state aid in Ukraine should be radically reformed in the light of this country's international obligations with respect to state aid and initiatives to reform the economic competition protection in keeping with the documents signed by Ukraine with the European Union and the WTO agreements. Indeed, in Ukraine the amounts of state aid are incomparably greater than in the European Union. If in the EU about 1% of GDP goes for state aid, Ukraine in the past year spent to these ends about UAH 52-70 billion, which amounts to 4-6% of GDP," Rybachuk said.
He also added that in the European Union state aid is provided according to clearly defined rules and principles, and the effectiveness of its use is monitored.
"Ukraine does not have at all any systems, methods or standards that would allow analyzing the effectiveness of state aid. The result is a sad picture: huge amounts of money are spent to support certain sectors of the economy, individual enterprises. Billions are spent non-transparently, which makes it possible to talk about corruption in taking certain decisions on state aid... This leads to distortions in competition in the market, adversely affecting the investment climate in Ukraine. This makes Ukraine uncompetitive in international markets," the expert said.
Last year, the Antimonopoly Committee of Ukraine developed together with EU experts a draft law on state aid to subjects of economic activity. As expected, this document has not met with much enthusiasm in the Ukrainian parliament and did not become a law that could give rise to a reform of state aid in Ukraine, Rybachuk underscored.
"The policy of state aid in Ukraine should be radically reformed in the light of this country's international obligations with respect to state aid and initiatives to reform the economic competition protection in keeping with the documents signed by Ukraine with the European Union and the WTO agreements. Indeed, in Ukraine the amounts of state aid are incomparably greater than in the European Union. If in the EU about 1% of GDP goes for state aid, Ukraine in the past year spent to these ends about UAH 52-70 billion, which amounts to 4-6% of GDP," Rybachuk said.
He also added that in the European Union state aid is provided according to clearly defined rules and principles, and the effectiveness of its use is monitored.
"Ukraine does not have at all any systems, methods or standards that would allow analyzing the effectiveness of state aid. The result is a sad picture: huge amounts of money are spent to support certain sectors of the economy, individual enterprises. Billions are spent non-transparently, which makes it possible to talk about corruption in taking certain decisions on state aid... This leads to distortions in competition in the market, adversely affecting the investment climate in Ukraine. This makes Ukraine uncompetitive in international markets," the expert said.
Last year, the Antimonopoly Committee of Ukraine developed together with EU experts a draft law on state aid to subjects of economic activity. As expected, this document has not met with much enthusiasm in the Ukrainian parliament and did not become a law that could give rise to a reform of state aid in Ukraine, Rybachuk underscored.
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