CORRUPTION IN UKRAINE: PROGRESS IN SIGHT?

Corruption in Ukraine remains endemic – Transparency International ranked Ukraine as the world’s 142nd most corrupt country out of 175 in 2014 – but the tide has started to turn.

Public Tenders

The size of kickbacks is currently at around 15% in 2015. In 2014 two islands of corruption in state procurement remained – that was [state-owned gas producer] Ukrgazvidobuvanie and Ukrainian Railways.

Rent seeking schemes

Anti-corruption efforts have also eliminated numerous rent-seeking schemes – where legal red tape creates profitable business for private structures linked to officials. Many are now being eradicated.

Hidden corruption

Corruption remains strong in the hidden sectors. This include the tax and customs services and the state treasury. Black market schemes for tax evasion continue to operate with the suspected collusion of tax officials.  Kickbacks are also still required for exporters to have VAT returned, as well as for suppliers to the state to receive payment from the treasury.

The other sphere where corruption remains unchanged is the everyday level of policing, education and medicine.  People still have to pay bribes in everyday life. Doctors, teachers and policemen cannot afford not to be corrupt because if they cannot supplement their income with informal payments, they will have to quit their jobs and find other work.

The creation of the National Anti-Corruption Bureau (NAB), the National Agency for Anti-Corruption and a number of legal amendments, for instance increasing jail time for corruption offences, are all milestones, meaning that the tools to fight corruption will soon be available. The NAB is tasked with investigating corruption among top office holders, with law enforcement obliged to act on its findings.