Country Private Sector Diagnostic in Ukraine report, prepared by the team of World Bank and IFC – International Finance Corporation

Published on: 04.08.2021
Category: PPP News

Country Private Sector Diagnostic in Ukraine report prepared by the team of World Bank and IFC – International Finance Corporation, is devoted to the analysis of the current state of private sector involvement in the sectors of economic and social infrastructure which are critical for the development of the country’s balanced economy and the recommendations’ development for realizing the private sector potential through PPP projects implementation.

The PPP mechanism in Ukraine has significant potential and is one of the main priorities for attracting investment in infrastructure development, both economic and social. A number of successful reforms and innovations have been implemented to bring the current legislation in the field of public-private partnership in line with international standards and practices. According to the World Bank assessment currently, the legal environment in Ukraine for attracting private business to infrastructure is in line with best international practices, provides transparency and clarity of initiation, preparation and implementation of projects on the terms of public-private partnership.

The capacity building of public authorities and local governments is the basis for expanding opportunities in the preparation of well-structured infrastructure development projects on the terms of PPP.

The government’s focus on involving the private sector in infrastructure development through the PPP mechanism should become a key element of Ukraine’s post covid economic growth, and the country’s fully insertion the country in global trade and investment flows

A range of economic sectors, such as roads, seaports, airports, energy and renewables, and health care, have significant potential for the PPP projects implementation.

Country Private Sector Diagnostic in Ukraine report contains recommendations on ways to realize this potential in Ukraine, including:

  • information on the Government of Ukraine success in key structural reforms implementing and macroeconomic stability strengthening, using the power and potential of the private sector to boost economic growth and improve the lives of all Ukrainians;
  • information on the impact of the COVID-19 pandemic on the country’s economy and existing opportunities to stimulate the private sector’s contribution expansion to economic growth in Ukraine;
  • options assessment to promote private sector development in three promising sectors of the economy, which can be “growth points” for a rapid recovery of economic growth, including through the PPP projects implementation as by mechanism for involving the private sector:

– Climate-smart agriculture (CSA) in a land market reform;

– Manufacturing global value chains (GVCs);

– Health care.

Active public policy in these sectors of the economy and the private sector’s capital and technologies involvement could leverage the country’s natural and human resources endowments’ and exploit their comparative advantage.

In particular, it is proposed to implement policy recommendations on:

  • support the swift implementation of the recently approved land reform and promote investments in climate-smart technologies to raise agricultural productivity and exports;  
  • boost exports and ramp up the attraction of foreign direct investment to increase participation in European manufacturing value chains;
  • leverage private sector solutions and investment to enhance efficiency in the provision of health services.