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Ukraine
FY 2001 Program Description and Activity Data Sheets
>> Regional Overview >> Ukraine Overview FY 2001 Program
The U.S. assistance program will continue to promote economic growth, strengthen democratic institutions, and address critical social issues. Activities to strengthen the economy will emphasize improving the investment environment and facilitating small and medium business development. Should Ukraine move forward with reform of important sectors of the economy such as energy and agriculture, USAID will look for ways to provide support, resources permitting. Assistance with democratic institutions will focus on the development of civil society, rule of law, anti-corruption, and effective local government. Recognizing that people have to understand and believe in the concepts of reform in order to implement lasting change, the U.S. Department of State and USAID will redirect a portion of FSA assistance to work with the next generation of Ukrainian leaders. This Next Generation Initiative will expand exchanges, training and educational programs, along with support for non-governmental organizations. Social issues addressed through U.S. assistance will include reform of the pension system, improvement in health care delivery, prevention and treatment of infectious diseases, addressing women’s reproductive health needs, and strengthening the abilities of non-governmental organizations to fill gaps in the social safety net, and to advocate for improved conditions. These objectives are inter-related, and USAID’s success in achieving them depends on synergism of their performance. Absent the rule of law, economic growth is unlikely to occur even if other aspects of the investment environment improve. Likewise, without attention to the collapsed social infrastructure that has left many Ukrainians without services and resources, popular support for economic reform will be limited.
In addition to these objectives, several special initiatives are also included in the FY 2001 assistance program for Ukraine. The Poland-America-Ukraine Cooperation Initiative helps Ukraine benefit from Poland’s transition successes. The Global Climate Change Initiative will assist Ukraine to develop the human, institutional and technological capacity to reduce greenhouse gas emissions. The Kharkiv Regional Initiative will assist the oblast in accelerating regional economic growth by improving the investment environment, increasing private investment, and developing trade links with the U.S. private sector. The Anti-Trafficking Initiative is a multi-pronged program to stem the sexual trafficking of women, assist the victims, and prosecute those responsible for this crime.
Improved health care service delivery is an important special initiative of the USAID program in Ukraine, emphasizing infectious diseases such as Tuberculosis and HIV/AIDS, women’s and children’s health, and medical partnerships between U.S. and Ukrainian institutions. The goal of these programs is to reverse the decline in the health status of Ukrainian citizens through prevention and improved, cost-effective health care. USAID is assisting Ukraine to implement a wide range of health care programs and system reforms.
This request includes programs implemented by other U.S. Government agencies. Under the Administration’s Expanded Threat Reduction Initiative (ETRI), significant funds will be provided in FY 2000 and FY 2001 for programs designed to enhance border security and export control capabilities. ETRI support will contribute to the nonproliferation of weapons of mass destruction, and associated delivery systems, materials, technologies, and expertise. Other U.S. Government agencies participating in technical cooperation programs with Ukraine through inter-agency transfers from USAID include the Environmental Protection Agency, Nuclear Regulatory Commission, and U.S. Departments of Energy, State, Justice, Commerce and Treasury.
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ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Increased Soundness of Fiscal Policies and Fiscal Management Practices, 121-012
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $905,000 FSA
PROPOSED FY 2001 OBLIGATIONS AND FUNDING SOURCE: $2,000,000, FSA
STATUS: Continuing
INITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2004Summary: Fiscal reform in Ukraine is necessary to ensure that the resources claimed by government are limited and are used efficiently for essential public purposes, such as defense or social safety net, without constraining or distorting private sector growth. This objective also recognizes that fiscal reform must be carried out within a broader framework of informed macroeconomic policy decision-making and implementation of comprehensive reforms to create a supportive environment for economic growth.
Activities under this objective currently focus on: (1) improving tax law, policy, and administration; (2) developing analytic techniques and procedures for budget preparation, adoption and implementation in both executive and legislative branches; (3) strengthening intergovernmental finance; (4) formulating macroeconomic analysis and policy recommendations; and (5) promoting administrative reform in the economic policy arms of the Government of Ukraine (IGOU). The immediate beneficiaries of USAID activities are the Ministry of Finance, the Ministry of Economy, the State Tax Administration, the Deputy Prime Minister for Economic Reform, the Office of the Prime Minister ("Apparat"), the Parliamentary ("Verkhovna Rada") tax and budget committees, and by extension, the taxpayers and voters of Ukraine. Entrepreneurs will benefit as more comprehensible and transparent fiscal systems are established.
Key Results: USAID will consider this objective achieved when Ukraine meets the following criteria. (1) The tax system is sufficiently fair, simple and transparent to encourage greater taxpayer compliance and revenue collection is increased without placing an undue burden on economic growth. (2) The process of budget preparation, adoption and execution is well informed, accurate, transparent and responsible. (3) The division of responsibilities and resources at all levels of government is well defined, and the relevant officials are held accountable. (4) Fiscal policy makes a positive contribution to macroeconomic stability and growth in GDP and personal income.
Performance and Prospects: Progress in this strategic objective has been slow in the past year, largely due to the presidential election, but the foundation has been laid for some significant progress under the new, reform government.
With respect to the tax system, a draft tax code was approved by the Cabinet of Ministers and submitted to the Parliament. The draft incorporates the value-added tax and enterprise profits tax laws previously enacted; and new sections on personal income tax, administrative provisions, property tax and local taxes and fees. Additional work is needed to ensure that the legislation is clear, consistent and "business-friendly." The Ministry of Finance and the parliamentary tax committee have asked for help from USAID advisors, and the new U.S. Treasury advisor, to achieve this objective. This assistance will be provided through the newly established Tax Policy Office in the Ministry of Finance, and the USAID-funded Fiscal Analysis Office of the Verkhovna Rada. In the area of tax administration, USAID advisors have: provided training in international accounting standards (IAS) for tax officials, to complement the introduction of IAS in 2000; expanded taxpayer education and services to promote voluntary rather than coerced compliance; helped refine audit selection and audit techniques; and facilitated the functional reorganization of the tax agency. These efforts are expected to continue and expand in 2000 as the tax administration agency works to qualify for a World Bank computerization loan, and will be complemented by IMF and Treasury advisors working on collection practices.
With assistance from USAID advisors, the 2000 budget presented by the Ministry of Finance was more transparent and understandable. Also, the budget resolution passed by the Parliament was more coherent and realistic, reflecting the efforts of the Fiscal Analysis Office to provide objective and quantitative analysis of proposed budgets and tax laws. Nonetheless, political concerns continue to militate against adoption of a realistic budget, and to delay budget adoption, despite more rigorous analysis in both branches of government and pressure from international donor organizations. Officials from the Ministries of Finance and Economy received intensive training in budget policy analysis over the past year under a USAID program, resulting in stronger awareness of the need for a more analytic and evaluative approach to the budget programs, in light of fiscal constraints. Efforts are underway to provide training to Ministry officials on, and introduce, program evaluation techniques. Work is also continuing on measures to reform intergovernmental finance, although the Ministry of Finance once again decided not to adopt the formula-based system of budget transfers to lower levels of government recommended by USAID advisors with support from the parliamentary budget committee. USAID expects to further work in this area, and on development of a property tax, in 2000 and 2001.
With assistance from USAID, the Ministries of Finance and Economy have adopted new organizational structures. Recent decrees have sought to shift the Ministry of Economy’s focus toward business development, in line with USAID recommendations. The Ministry of Economy’s, macroeconomic monitoring group, established with USAID assistance, continues to compile key economic indicators, and provide analysis to help top Ukrainian officials with economic policy making.
Funding for this objective has been reduced considerably for FY2000, causing a re-examination of current activity levels. A USAID-funded evaluation of all macroeconomic and fiscal reform activities in Ukraine is expected to take place in March 2000, and based on the results of the evaluation, plans will be developed for future activities in this area. The possibility of combining all activities under a single contractor is being explored, as well as a longer-term contract that would run through the expected completion date of 2004. However, no decisions on this have yet been made. Priority activities to be continued may include development of the tax policy function, further support to modernization of the tax administration process, increased attention to budget program evaluation, and work on development of local government revenue sources, especially the property tax. Increased effort will be devoted to establishing the Fiscal Analysis Office as a permanent arm of the Parliament, along the lines of the Congressional Budget Office.
Possible Adjustments to Plans: Activities are subject to substantial reduction, to be determined based on results of evaluation plus changes in budget allocation, if any.
Other Donor Programs: USAID fiscal reform programs are closely coordinated with both the International Monetary Fund and World Bank to ensure that technical assistance supports the fulfillment of loan conditions. USAID is providing technical assistance to the tax administration agency on a pending World Bank loan for modernization and computerization; to the Ministries of Finance and Economy on the proposed World Bank, public administration reform structural adjustment loan; and to various entities on a World Bank, local government finance loan. USAID technical assistance in tax administration, budget procedures, intergovernmental finance, and administrative reform are directed toward helping the Government of Ukraine meet IMF program conditions. In all these areas, USAID’s work is also coordinated with other U.S. Government-funded organizations, mainly the U.S. Treasury, and with other public and private donors and non-governmental organizations. Joint work related to fiscal reform is being carried out with the European Union, Canada, and the United Kingdom.
Principal Contractors, Grantees or Agencies: KPMG/Barents Group, Harvard Institute for International Development, Center for Social and Economic Research (Warsaw), RAND Corporation, International Center for Policy Studies (Kiev), and U.S. Department of the Treasury.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)GOU meets IMF deficit targets
No(1995) Yes Yes Yes Yes Revenues equal or exceed forecast levels
No(1995) No Yes Yes Yes Central-to-local government funds transfers are done on a formula basis
No(1995)
No
Yes
Yes
Yes
The number of budget revisions required due to inaccurate budget forecasts is reduced 3(1995) 3 1 1 * The number of taxpayers included in the taxpayer identification system increases (millions) 0 (1995) 27 32 35 * __
* Reporting to be discontinued.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Accelerated Growth and Development of Private Enterprises, 121-013
PLANNED FY 2000 OBBLIGATION AND FUNDING SOURCE: $30,425,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCES: $33,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2005
121013a: A More Market-Responsive Agriculture Sector
Summary: U.S. assistance to agriculture and agro-industries in Ukraine has been premised on the expectation that fundamental policy reform would take place relatively quickly. USAID assumed that reform would result in an expanding open market and a private sector-driven agricultural economy. Thus, USAID designed programs to spearhead key policy changes nation-wide through activities that would demonstrate the effectiveness of open markets and related private input supply, processing and marketing institutions, as well as private land ownership and farm management.
From 1996 until late 1999, the prospects for fundamental policy reform at the national level did not meet these expectations. The pace of reform was slow and uncertain, and the Government of Ukraine undertook policy measures that resulted in a more adverse environment for private-sector-led, agricultural development. These measures included restrictions on private marketing of grain, and an initiative by the Government to supply agricultural inputs, fertilizer, and machinery. Opposition to private land ownership and private farming remained strong in parliament and in many parts of Ukraine’s Government.
However, the potential for fundamental reform by Ukraine’s national government may now be growing as evidenced by the December 1999 issuance of a presidential decree to privatize all collective agriculture enterprises, and all land within these farms. USAID also believes that regional and local governments are increasingly amenable to greater private sector participation in the agricultural sector.
Should the Government of Ukraine continue to demonstrate serious commitment to agriculture reform, USAID’s agricultural sector assistance program will build on these positive developments by focusing assistance at the regional level, resources permitting. Activities will emphasize direct benefits to private farmers and households through improved marketing, input supply, credit, and extension service availability. Efforts will be concentrated in two to three geographic locations where prospects for private farmer and household production and marketing improvements appear good. Farm restructuring and agricultural land privatization will be central to this approach as will the provision of agriculture inputs through the creation of private dealerships, promotion of trade and the development of cooperatives.
Given the absence of the traditional sources of credit to private farmers, USAID is also exploring a range of alternative institutional approaches to address the credit constraint, including credit unions, cooperatives and suppliers’ credit. USAID will work to strengthen cooperatives and farmers’ associations to directly link individual farmers with markets and to encourage private farmers, restructured farms and plot holders to trade on open markets. USAID will also address the constraints faced by private farmers, restructured farms, and plot holders in dealing with elements of the agricultural production-marketing-processing chain through approaches that reflect the diversified nature of their production.
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USAID will strengthen private professional and trade associations’ capacity for analysis and advocacy for policy reform. In addition, USAID will work with interested national and local government officials to create the enabling environment necessary for the regional agricultural initiatives to operate effectively. These associations will channel their efforts’ progress and articulate their agenda to national agricultural policy decision-makers. USAID will continue to provide limited assistance to the National Private Farmers Association, the National Commodity Exchange Association, the League of Entrepreneurs, and the Ukrainian Cooperative Foundation so that these organizations articulate and promote a unified policy reform agenda more effectively.
Key Results: USAID will consider this objective met when sustainable nation-wide agricultural policy reforms are implemented; and private farmers in selected regions have access to increased supply of the support services, and inputs necessary to increase their production and marketing of agricultural commodities.
Performance and Prospects: USAID activities have achieved significant results since 1993, although these achievements have fallen short of the fundamental agricultural reform anticipated. First, land ownership has been transferred from the state to collective agricultural enterprises (CAEs). About 6.5 million land shares have been issued for CAE land with land titles issued to 220,000 people. Over 600 farms have been restructured or privatized through USAID-supported activities. The number of private farmers rose from under 2,000 in 1992 to 36,000 in 1997, accounting for over 900,000 hectares. Second, the USAID-supported process of mass privatization resulted in the privatization of over 4,000 agro-industrial enterprises. Despite delays, the process of privatization of grain elevators has resulted in 371 elevators privatized to 70% and 42 fully privatized.
Third, the private sector has become active in input supply and agricultural marketing and processing. Private, U.S. agri-businesses in partnership with Ukrainian entities have expanded the provision of inputs, processing facilities, and marketing outlets. Private independent commodity exchanges, with functioning, spot and forward contract mechanisms, have operated at an increasing level with active government procurement being done through the exchanges. In addition, USAID established the Commodity Exchanges Information System under the National Commodity Exchange Association to provide weekly information on Ukrainian and world prices. Price information has been disseminated to over 1,100 direct recipients, including newsletters, news agencies, oblast administrations, agricultural producers, processors, and distributors. Finally, private industries, private farmers and cooperatives, as well as commodity exchanges have established, with USAID support, independent associations to defend their interests and lobby for policy change.
A framework has been established, through the Presidential Commission for Agrarian Reform, under which the Government of Ukraine, and international donors have collaborated to reform the agriculture sector. The USAID and World Bank-funded Agricultural Secretariat and the Policy Analysis Group have led this agriculture reform effort. In late 1999 the Government of Ukraine issued a very positive land reform decree that will privatize all CAE farms in the country and provide land titles to over 6 million people. The Government of Ukraine has initiated steps to create a new, Agriculture Policy Ministry to replace the Ministry for the Agro-Industrial Complex. The Government of Ukraine expressed its intent to transform its role in the agricultural sector from one of control to one of support. USAID sees these events as the first major steps of the reform process.
Possible Adjustments to Plans: The entire USAID agricultural portfolio and strategy is now under review because of major reductions in the USAID-managed assistance budget for Ukraine, and the nascent policy reform measures being undertaken in the agricultural sector. USAID is assessing how it can be responsive by helping the Government implement the recent land reform decree, and provide other support to a more reform-minded government resources permitting.
Other Donor Programs: The World Bank, the British Know How Fund and USAID have cooperated closely in their policy reform and project activities, and are jointly funding internal Ukrainian agricultural policy analysis, and agricultural reform efforts through the Agriculture Secretariat. The IMF recently included agriculture reform as one of the major elements for future policy conditionality and continuation of its Extended Fund Facility. Preliminary discussions between the IMF and the Government of Ukraine appear poised to finally bring about major policy reform in the agriculture sector. USAID has actively participated with the IMF on the agriculture reform agenda. The World Bank had put its programs on hold until several pieces of legislation were passed, and USAID saw concrete evidence of the Government of Ukraine’s intent to proceed with major agriculture reform. The World Bank now plans to reassess whether to restart a full program of adjustment loans and other projects in early 2000, though it has yet to plan for additional, policy-related, sector adjustment loans because of the same policy reform problems faced by USAID. Nevertheless, the World Bank has plans to include policy-related issues in various projects that are under development, as well as a small effort with the Presidential Commission. The World Bank also has developed several new projects to include land title registration, rural finance (credit), agribusiness, and possibly co-financing of farm restructuring. Finally, the World Bank has linked many of these projects to existing, USAID initiatives, enhancing the impact and sustainability of USAID’s program activities.
Principal Contractors, Grantees or Agencies: RONCO, Louisiana State University, Iowa State University, Citizens Network for Foreign Affairs, Land O' Lakes and ACDI/VOCA.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Government issued land titles, including those by RONCO, (thousands)
25(1997) 220 (incl. 173 by Ronco) 325 1000* 3000 State-owned grain elevators privatized
- privatized to 70%
161(1998) 161 353 27 0
- totally privatized to 100%
15(1998)
15
81
442*
469
Private joint venture partnerships establishing private farm-service centers, processing facilities and other agribusiness in Ukraine (under AP-II Program) 24(1998) 24 332 332 ** More effective Presidential Commission ( legislation, regulations and decrees prepared by working units and approved by COM, President and/or Rada) 5 (1998) 5 6, plus notes on 30 draft laws 15 25 Individuals registered as private farmers (thousands) 36 (1998) 36 40 45 50 Restructured farms (RONCO farms) 500 (390) (1998) 500 (390) 1000 (690) 3000 6500 Land area under private farms 908(1998) 908 1080 1350 1750 Private sector contribution to agricultural production*** 60% (1998) 60% 62% 65% 68% __
*Target increased
**Indicator to be discontinued.
***Reporting to be discontinued.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Accelerated Growth and Development of Private Enterprises, 121-013
PLANNED FY 2000 OBBLIGATION AND FUNDING SOURCE: $30,425,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCES: $33,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2005
121013b: Privatized Enterprises are More Competitive and Efficient
Summary: With completion of USAID’s mass privatization program, the Government of Ukraine has privatized the vast majority of state-owned enterprises. Following on the success of that program, USAID has focused its support for the development of privatized enterprises on providing essential business skills, removing external constraints and creating an enabling environment for private sector growth. In particular, USAID has focused on the area of reducing financial constraints to growth by promoting private ownership of urban land under enterprises and land markets in Ukraine.
USAID identified access to credit as the most critical ingredient for growth of all private enterprise. USAID targeted this problem directly through the West NIS Enterprise Fund and indirectly through collateral law, capital markets, banking, and tax system reform that facilitate the flow of private investment. Training and certification efforts under the accounting reform activities – and the training program under the enterprise-restructuring program – ensure access to business skills and information. In addition, the USAID program has provided support to organizations within the Government of Ukraine to promote reforms to the business, legal and regulatory environment because the legal and regulatory environment has prevented these privatized enterprises from restructuring. These activities will directly benefit the business community of Ukraine and those they would employ through the introduction of training and restructuring methods and the jobs created by new and growing businesses.
Key Results: USAID will consider this objective achieved when the economic environment both encourages and supports efforts by privatized enterprises to undergo restructuring in order to become more efficient and competitive. Principal results leading to this outcome include: (1) laws implemented to reduce or eliminate the numerous legal and regulatory constraints to growth and restructuring; (2) business and commerce regime established that encourages restructuring, involves greater outside ownership and control over privatized enterprises, and stimulates the demand for more restructuring; (3) prospects for additional investment for restructured firms improved and privatized enterprises motivated to undergo restructuring; and (4) business skills and training made accessible to entrepreneurs.
Performance and Prospects: Over 45,000 small enterprises have been privatized, 15,500 with direct USAID assistance, in over 70 cities in 23 oblasts throughout Ukraine. As a result, over 90% of all small enterprises in Ukraine are privately owned, providing employment to more than 660,000 people. By the end of 1999, over 7,000 unfinished construction sites were privatized, with over 1,500 privatized with direct USAID assistance via 300 auctions. This privatization resulted in the creation of about 6,700 new jobs in the new firms; the transfer of unproductive, state-owned resources to productive employment by new private owners; and additional revenue for the budgets of local governments. By the end of 1999, more than 9,500 medium and large enterprises were privatized out of a universe of approximately 11,000. Of these, nearly 6,000 were 100% privately owned. In 2000, plans are to facilitate the privatization of another 7,000 unfinished constructions and to continue supporting the improvement of the regulatory framework to speed up the privatization.
Through the Land Privatization program, there has been considerable success working at the level of oblast and municipal government to privatize enterprise land. Privatization of land under enterprises started only in October 1997, but has been highly successful with more than 1,500 land privatizations completed by the end of FY 1999. The additional benefit from these sales has amounted to over 44,000,000 Hryvnia in revenue generated for local budgets. One of the sustainable elements of the project has been the establishment of successful local offices in every region of Ukraine except Kiev. An ultimate goal is commercializing these offices and leaving behind profitable entities in every region of Ukraine. In addition, advisors have assisted with the drafting and passage of legislation on Mortgage Law to assist with the issue of the inability of many potential businesses and people to obtain credit. In the third year of the program, activities are planned to initiate a secondary market, and improve capabilities of real estate services.
Considerable progress has also been made in the Accounting Reform Project. 1999 saw a significant change in this area. The Accounting Law that established a new accounting system was passed in August 1999. The system was compliant with international accounting standards (IAS) and came into effect on January 1, 2000. In co-operation with the Ukrainian Federation of Professional Accountants and Auditors (UFPAA), an association established with the USAID assistance, IAS training was provided to accountants and auditors. Fifteen pilot enterprises have been assisted in transforming their accounting to IAS, which helped to improve the management of enterprises, and to make their accounts more transparent to investors. In 2000, USAID will continue to support the accounting reform framework, and assistance will be extended to at least 700 enterprises to convert to the new IAS-based system. In addition, the UFPAA training and certification program will be further developed and implemented. Finally, USAID will provide assistance in developing and implementing a new university accounting and auditing curriculum, and in establishing three, U.S.-Ukrainian, university partnerships.
At the enterprise level, a program to convert Ukraine’s small, medium and large enterprises carried out restructuring activities at ten enterprises in a variety of industries, including milk processing, ship building, retail, light manufacturing, and metallurgical industries. All project work was done through the auspices of the investment intermediaries that have controlling interest in the selected enterprises, thereby ensuring co-operation of the enterprise employees and the board of directors. Eleven additional enterprises are slated for participation in this program by spring, 2000. The second year of the program will focus on the creation and dissemination of informational and training materials based on practical experience and successful results achieved. Finally, the West NIS Enterprise Fund continues a program of debt and equity investments in medium and large enterprises in Ukraine, for a total of over $46 million in completed transactions.
Possible Adjustments to Plans: These programs recently underwent strategic review, and no adjustments are planned for the present.
Other Donor Programs: USAID has worked closely with international financial institutions in providing technical assistance to meet their lending conditionalities. Regarding enterprise restructuring, USAID recently initiated a donor coordination group for assistance to privatized enterprises. In addition, USAID has coordinated closely with the World Bank regarding the pending Private Sector Development loan.
Principal Contractors, Grantees or Agencies: International Finance Corporation, The Recovery Group, Barents Group, London Business School, Price-Waterhouse-Coopers, International Business & Technical Consultants Inc, East European Real Property Foundation, and the West NIS Enterprise Fund.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Number of construction sites privatized
5,000(1998) 5000 10000 15000 * Enterprises using international accounting standards**
0(1998) 0 300 600 900 Number of sales of land under privatized enterprises (activity ends)
30(1997)
265
1,500
2000
*
__
*Indicator discontinued given planned end of activity.
** Planned targets have been revised. Because of the SSMSC’s inability to enforce the regulation requiring International Accounting Standard reporting by enterprises except on a voluntary basis through 1999. The revised targets more accurately reflect the anticipated growth of IAS by enterprises not publicly traded.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Accelerated Growth and Development of Private Enterprises, 121-013
PLANNED FY 2000 OBBLIGATION AND FUNDING SOURCE: $30,425,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCES: $33,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2005
121013c: Expanded Role of Small and Medium Enterprises in National Economy,
Summary: Small and medium enterprise (SME) development is an essential element of Ukraine’s transition to a market economy. SME development can make a positive difference in peoples’ lives through its impact on the labor market. In the long term, SMEs are likely to become the largest source of employment for the people of Ukraine. In Western Europe, for example, approximately 50% to 70% of the workforce are employed by SMEs. According to official figures, only about 10% of the labor force in Ukraine are employed by SMEs. In Russia, the figure is 20%. In Eastern Europe generally, SME employment is between 45% and 50% of the labor force. A large part of SME activity in Ukraine currently exists in the informal economy as reflected in an extensive SME Baseline Survey conducted with USAID financing in 1999. Creating an environment that encourages SME growth will promote movement of SMEs from the informal sector to the formal sector, which will lead to additional benefits to the state in the form of increased revenues generated by greater tax compliance.
The USAID program has concentrated on removing constraints and creating an enabling environment for private sector growth. Up until 1997 USAID focussed principally on improving access to business skills but in 1998 USAID began to assist business associations and the GOU in promoting reforms in the legal and regulatory environment, a critical constraint to the development of SMEs. Access to credit has been another important ingredient for SME growth, and USAID has targeted this problem directly through support for the West NIS Enterprise Fund, the Eurasia Small Lending Program, the European Bank for Reconstruction and Development (EBRD) Micro-credit Program, credit union development and other micro-enterprise credit initiatives.
Beneficiaries include proprietors and employees of micro-, small- and medium-sized businesses via various firm-level assistance activities and policy/regulatory reforms.
Key Results: USAID will consider this objective achieved when: (1) the high tax and regulatory burden on private enterprise is reduced: (2) the weak financial system is improved to permit SMEs greater access to credit and investment; and (3) the level of business skills in enterprises is improved.
Performance and Prospects: A total of 15, USAID-funded, business service centers have been created to date to ensure that SMEs have access to business skills. Over the past four years, more than 20,000 clients have received services through the eight NewBizNet Centers in regional centers, and seven IFC business centers located in smaller cities. Sustainability of these business centers has been a goal since their creation, and has been achieved substantially in almost all of the centers. USAID has also provided modest support to business schools in Lviv, Kiev, and Donetsk; and trained over 1,000 Ukrainian accountants and auditors in international accounting standards, reporting, and managerial accounting. Work under the Alliance Consortium over the past three years resulted in specialized technical assistance through business volunteers to more than 450 companies.
In November 1999, USAID conducted a national conference on business association development. This conference highlighted the work of the network of over 100 business associations established under the NewBizNet Project. An international conference on SME development was held in November 1998, with international speakers and roundtable discussions on key topics, presentations by existing SME support programs; and an interactive information fair with participation by various SME support programs available in Ukraine. The conference highlighted the Government of Ukraine success in reducing the number of days required to register businesses from 35 to less than four, and reducing business registration costs by almost 50%. The State Committee for Entrepreneurship Development, with USAID assistance, has demonstrated its capacity to analyze and challenge regulations that are found to be unfavorable to business development.
USAID’s program to create and ensure the sustainability of credit unions succeeded in setting up eleven model credit unions in various regions of Ukraine; and has trained more than 800 credit union managers, board members, and initiative group representatives. In addition, USAID has assisted the Ukrainian National Association of Savings and Credit Unions (UNASCU) to improve its services to member credit unions and to develop new legislation that more appropriately reflects credit union activity in Ukraine. Although the original grant ended in September 1999, USAID has planned to continue work through a new grant beginning in FY 2000. USAID has financed technical assistance to private banks participating in an EBRD, Micro-credit Program that began in December 1998. As of October 31, 1999, this program had an outstanding portfolio of 97 loans averaging $6,607 per loan. Simultaneously, the EBRD’s Small Loan Fund had a portfolio of 65 loans, averaging $28,261 per loan. The German KFW Micro Credit program’s outstanding portfolio was 354 loans averaging DM14,45.
The USAID-financed, Business Management Education Program began in early 1999 to strengthen the capacity of Ukraine to provide business management education by establishing partnerships between U.S., Polish and Ukrainian faculties and institutions. This program was initiated to strengthen the capacity of Ukrainian universities and polytechnics to develop the business management curriculum, and achieve financial sustainability of their business education programs. Memorandums of Understanding have been signed between managers of the USAID program and 35 Ukrainian institutions. University administrators visited the United States and Poland in August 1999 to meet with their counterparts, and exchange information and ideas on how universities and business schools should be structured, managed and funded. Individual institutional implementation plans were developed at the end of the tour. A National Business Education Conference was conducted in December 1999 in Odessa that incorporated the results and feedback of training and study tour programs. Another outcome of the conference was a blueprint for reforming business education in Ukraine.
A new initiative was undertaken to address gender concerns in the SME portfolio during 1999 with the appointment of a Women-in-Development Fellow to the Business Development Division. Strategies and action plans to address the needs of women were developed by all implementers of business skills development activities and an extensive SME baseline survey revealed that over 30% of all SMEs in Ukraine were either owned or operated by women. Another USAID project, Women’s Economic Empowerment, has increased opportunities for women entrepreneurs through the development of programs of support to women-run enterprises.
The prospects for effective SME reform in Ukraine are good. The Government generally looks on SME development as a win-win situation. Even among those in the government who oppose other reforms, development of small enterprises represents a political "good" which both provides jobs and increases tax revenues, while resulting in very few negative side effects. While officials may balk at specific deregulation aspects or some other important steps in private sector development, a mandate to push such changes through the system is often easy to establish under the flag of small enterprise development. A very powerful and persuasive argument in favor of reforms to support SME development is that these changes are not costly to the government, either in terms of finance or political capital (i.e., impact on voters is only either positive or neutral, but never negative). Finally, recent changes in government following the re-election of President Kuchma portend strong potential for improvement in the SME policy and regulatory environment. The selection of a strong proponent of small business development in the First Deputy Prime Minister position is viewed as a positive development for improving the environment for SMEs in the upcoming months. USAID will provide support to the First Deputy Prime Minister’s Office – and other governmental agencies at the national, regional and local levels – over the next three years. The object of this assistance is to pave the way for reforms to the enabling environment for, and removal of constraints to SME growth.
Possible Adjustments to Plans: A number of SME development activities have either reached their end or will come to a close in FY2000. A new SME development project ("BIZPRO") will begin in FY2000. This activity will move USAID's SME development program in Ukraine into the next generation, based on lessons learned in other countries in the region and on the recently adopted SME development strategy of the Europe and Eurasia Bureau of USAID. This new project will consolidate a number of activities in the current SME development portfolio, reducing the management burden and capitalizing on linkages among a number of activities dealing with SME development. Several existing activities, which for practical reasons will not be included in "BIZPRO", will continue as well.
Other Donor Programs: Other development partners are active in promoting the growth of SMEs, through such means as loan funds to support micro-enterprise development, technical assistance, and loan conditionality that requires the Government of Ukraine to continue to work toward creating a positive enabling environment for SMEs. Germany, Canada, and Great Britain, as well as the European Union, United Nations Development Program and the World Bank, all provide funds for programs to promote SME development. Representatives of USAID and these agencies meet on a regular basis to coordinate their assistance programs for SME development.
Principal Contractors, Grantees or Agencies: Development Alternatives, The Alliance, International Finance Corporation, Junior Achievement, Winrock International, and the University of Minnesota are key implementers of existing projects. The implementer of BIZPRO will be determined in FY2000.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)
Clients at business service centers and business incubators
6500(1997) 10000 12000 TBD* TBD*
Increased number of loans to SMEs from banks**
0(1997) 50 200 500 1000 Number of days completing business licensing
35(1997)
35
25
15
10
and registration process 30(1997) 10 7 5 3 Business associations Conduct roundtables and workshops on policy and regulatory reform 0(1997) 2 5 10 15
__
*Targets after 1999 will be determined in consultation with the implementing partner for the new "BIZPRO" project when that party is selected.
**This indicator is replacing "Institutions providing micro-credit" from last year’s Congressional Presentation as a more direct measure of financing in the hands of entrepreneurs.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: A More Competitive and Market-Responsive Private Financial Sector,121-014
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $6,736,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $5,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2004
Summary: Financial sector reform in Ukraine will transform a mechanistic, bookkeeping system into a service-oriented sector based on market principles, and capable of providing financial support to consumers and to small and large businesses. The Government's role in the transformation is to develop an infrastructure that promotes safe, sound and responsive financial services, and to provide the legal and regulatory framework that will allow the sector to operate effectively and responsibly. Such a system critically depends upon several factors: (1) an economic environment of growth and private initiative, supported by government stabilization policies that promote efficient resource allocation; (2) a legal environment that specifies transparent "rules of the game"; (3) government regulatory authorities who are able to enforce the "rules of the game" in an evenhanded way; (4) a culture and incentive structure that encourage financial market players to carefully analyze the risks of their activities and conduct their business in a manner consistent with western "best practice"; and (5) a steady upgrading of human capital stock to provide the sector with needed management and decision-making capacity.
During the past six years, USAID’s technical assistance has been developed with these objectives in mind. Emphasis has been placed on developing the fundamentals: financial infrastructure, human capital, and a supportive legal, policy and institutional environment. USAID plans to continue this approach, along with careful attention to the sequencing of technical assistance to concentrate on the fundamental building blocks of a functional financial system. Beneficiaries of these activities include all those involved in the private financial sector, including enterprises and households that need access to finance.
Key Results: USAID will have achieved its objective of a more competitive and market responsive, private financial sector when the following results attain. (1) Fundamental financial infrastructure is developed that will increase public confidence in the banking sector, create a level playing field in which all banks can compete, and strengthen the National Bank of Ukraine’s (NBU) supervisory authority. (2) Institutions and practices are established for an open, transparent and safe equity market that will provide savings vehicles for homeowners and businesses, and, in turn, supply capital to industry, commerce and the Government. (3) A market-oriented legal and regulatory infrastructure is in place that provides both the financial institutions and the entities they serve with an effective and transparent framework in which to operate.
Performance and Prospects: USAID has provided strong support for the development of the Ukrainian fixed-income market, encompassing banking and government securities. This effort has included critical support to the National Bank Ukraine’s regulatory authority and capacity, putting into place regulations that include classifying and provisioning for bad loans; setting higher minimum capital requirements; and lending to one borrower and related parties. Supervisors have been trained in both Western-based inspection techniques, off-site risk analysis, and rehabilitation techniques for problem banks. In collaboration with other donors, USAID has helped convert the banking system to international accounting standards (IAS). An initial pilot program of banks tested the new chart of accounts. Subsequently, IAS was introduced throughout the banking system in January 1998.
Since that time, USAID has been working with commercial banks to deepen the usage of IAS-based financial reporting, and develop back office functions such as internal auditing. Work has continued on the creation of a self-sustaining banking school. To date, over 3,000 bankers from all over Ukraine have received short-term training. In addition, USAID has worked with the leading Ukrainian business school, the International Management Institute, in implementing a one-year intensive training course leading to an Master in Business Administration (MBA) in banking. Approximately 100 banking professionals have received MBAs under this program. Thirty are currently enrolled in the program, and have been paying partial tuition costs. A number of graduates have been team-teaching with foreign advisors at the banking school.
USAID assisted the IMF in completing diagnostics of the seven largest banks that were identified as presenting the greatest risk for systemic failure of the banking system. As a consequence, each bank agreed with the National Bank of Ukraine in a Commitment Letter to increase loan loss provisioning, augment capital and adopt stringent credit policies. While TACIS has been assisting three to four of these banks, USAID agreed to assist another one of the banks in its restructuring.
Much of the work in the banking sector will be coming to a planned closure in 2000. Focussed assistance will continue in training, bank restructuring, and with bank rehabilitation in the National Bank of Ukraine Problem Bank Resolution Department.
During 1996 and 1997, USAID’s activities led to the formation of the Securities and Stock Market State Commission (SSMSC) and its authorization to regulate the corporate securities market. USAID provided assistance to the SSMSC in conducting enforcement activities and surveillance inspections; analyzing disclosure filings and financial statements; and conducting training and education programs covering all areas of securities markets, especially corporate governance. USAID also spearheaded legislative coalition building and assistance in the drafting of laws and regulations in the areas of securities and the stock exchange, business association, joint stock companies, and self-regulatory organizations. USAID supported the formation of the broker-dealer association (PFTSA), which in turn established a nation-wide, electronic trading system (PFTS). By the end of 1999, PFTSA membership reached 240 in twenty-one cities, and the total volume of trades by the membership grew to $196 million.
In addition, USAID assisted in the establishment of the All-Ukrainian Clearing Depository that will settle all securities transactions for publicly traded companies starting in 2000. USAID projects created trade associations for registrars and depositories (PARD), for investment funds (UAIB), and for accountants and auditors (UFPAA). By the end of 1999, PARD membership surpassed 270 in all principal cities. UFPAA and the Ministry of Finance adopted fourteen National Accounting Standards in compliance with IAS.
In addition to providing assistance for legal reform in banking and capital markets, USAID assistance contributed to the passage of the amendment to the Law on Pledges to establish the State Pledge Registry of Movable Property. The Registry will promote secured lending by establishing priority rights for pledges and tax liens. The Registry went into operation on March 1, 1999, making it the first nationwide electronic pledge registry in the former Soviet Union. In addition, a modern bankruptcy law was passed in August 1999 and became effective January 1, 2000. USAID has provided extensive training for judges of the Highest Arbitration Court and other legal and financial professionals; and has established pilot centers where trained bankruptcy practitioners will assist enterprises to undertake financial restructuring under the new law.
Current development of the Ukrainian financial sector occurs against a backdrop of turmoil in international financial markets. The difficult situation in Russia is of particular importance to Ukraine because of the close trade and financial ties between the two countries. Compounding this situation, macroeconomic policies are dampening private sector development, and resulting in highly restrictive monetary policies leading to liquidity problems for banks and enterprises. While USAID’s basic, financial sector objectives and programs will not change, particular care will be exercised in this environment to ensure that efforts do not destabilize an already fragile financial system.
Possible Adjustments to Plans: The banking program will be phasing down as planned; the capital markets program is being severely constricted by budget cuts; the legal reform program will continue as planned.
Other Donor Programs: USAID’s work in the banking sector is supportive of both the World Bank Financial Sector Adjustment Loan (FSAL) and the IMF Extended Fund Facility (EFF), twenty-five conditionalities of which concern the banking sector. Upgrading National Bank of Ukraine (NBU) bank supervision, developing NBU capacity to deal with problem banks, passage of banking laws, deepening the conversion to international accounting standards are all examples of USAID activities that feature prominently in both FSAL and the EFF. Joint programs exist with the European Unions technical assistance program for Eurasia (EU-TACIS) and the British Know How Fund in bank accounting; with EU-TACIS in problem bank restructuring; and with the Swiss government in bank training. USAID’s efforts in strengthening the capital markets are reinforced by the World Bank’s activities through its Enterprise Development and Adjustment Loan II. In addition, the European Union has initiated corporate disclosure and custodian development programs that also support the achievement of USAID’s financial sector objective. The World Bank and EU-TACIS implement complementary programs in bankruptcy.
Principal Contractors, Grantees or Agencies: Financial Markets International, Price-Waterhouse-Coopers, Barents/KPMG, International Business and Trade Consultants, Inc., Financial Service Volunteer Corps, Gavin Anderson, International Reform and the Informal Sector/University Research Corporation International, Deloitte and Touche, and Associates in Rural Development/Checchi.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)
Commercial banks meeting minimal capital requirements
89 (1995) 97% 99% 100% * Bank examinations focusing on asset quality and management
0(1995) 50% 50% 60% * Securities enforcement/compliance activities
0(1995)
**
6
10
20
Securities market capitalization ($ millions) 0 (1995) 1300 10000 15000 20000 Pledges/tax liens registered as collateral 0 (1998) 0 35000 50000 70000 Enterprises completing financial restructuring 0 (1998) 0 0 20 100 __
*No plans at this time to report on indicator beyond 2000.
** Not available.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE: A More Economically Sustainable and Environmentally Sound Energy Sector, 121-015
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE $952,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $2,000,000 FSA
STATUS: Continuing
INITIAL OBLIGATION: FY 1994 ESTIMATED COMPLETION DATE: FY 2005Summary: The Ukraine energy program has three primary activity areas: (a) power sector privatization and reform; (b) training and utility partnerships; and (c) energy efficiency and conservation. The power sector privatization program, by far, has the greatest short-term potential, and involves numerous donor organizations and top level Ukrainian government officials. Increasingly, the training and utility partnerships are being re-oriented to support privatization, and the energy efficiency programs are shifting more towards support of municipalities and global climate change concerns.
As a legacy of the former Soviet economy, Ukraine’s energy sector has continued to be centrally controlled and inefficient. Energy production has been cut in half since independence, and the physical infrastructure has deteriorated greatly. The sector has accumulated very large debts, mostly owed to Russia. The Government of Ukraine has used over half of Ukraine’s hard currency to pay for imported fuel; and has heavily subsidized energy production and consumption. Fuel suppliers have been unable to collect even meager payment in cash from customers and they have often lacked the ability to cut off service for non-payment.
Ukraine began the process of power sector restructuring in the 1990’s to address apparent financial and managerial problems and to develop a financially sustainable power sector. First steps included the break-up of eight, regional energy production and distribution monopolies, and the establishment of a regulatory institution. The industry now consists of four thermal, one nuclear, and two hydroelectric generating companies (GENCOs), and 27 local distribution companies (LECs). Additionally, a mandatory central dispatch pool, based on an early version of the United Kingdom’s pool, was formed in Ukraine.
Privatization of energy companies and legislative, regulatory and market reform is now essential. Strategic investors are necessary to bring capital, technology, competitive fuel procurement techniques and management expertise in order to put the energy sector on a sound commercial footing. The ability of strategic investors to achieve critical mass and, thereby, withstand political pressure from entrenched interests is essential to success.
In early 1999, a Power Sector Task Force with representatives of the Government of Ukraine, the European Bank for Reconstruction and Development (EBRD), World Bank, G-7 countries, and European Commission was formed. Agreement was reached to simultaneously concentrate efforts on improving laws and regulations governing the wholesale and retail electricity market operation and on privatizing the electricity distribution companies. Hence, USAID’s technical assistance on privatization and reform has been provided under the auspices of this implementing Task Force.
In December 1999, the U.S. Government and the Government of Ukraine signed a Memorandum of Understanding (MoU) on reforming the electric power sector of Ukraine in support of the goals of this Task Force. In the MoU, USAID has obligated itself to assist the State Property Fund, the National Electricity Regulatory Commission, the Ministry of Energy, the Alternative Fuels Center, the Kommunar Company in Kharkiv, municipalities (district heating and energy efficiency), newly created Energy Service Companies and NGOs. If the Government of Ukraine privatizes approximately seven of the remaining 20 distribution companies, it will meet the major outstanding EBRD loan condition for funding completion of construction of two nuclear generating units and the corresponding closure of the remaining operational unit at Chernobyl.
Key Results: USAID’s primary objectives for the Ukraine energy program are (1) to properly establish the legal, regulatory and market rules to enable strategic private investment; (2) to initially privatize the electricity distribution companies and subsequently a majority of the power plants; (3) to increase utility payments made in cash significantly; (4) to improve efficiency in energy utilization by establishing a network of municipalities focused on energy efficiency technologies and implementation; and (5) to have Ukraine make a positive contribution to the fight against global climate warming.
Performance and Prospects: In 1995, the integrated power system was broken up into generation, distribution and transmission companies, totaling 35 companies. In addition, Ukraine set up a countrywide power pool. USAID has been the lead provider of technical assistance to the National Electricity Regulatory Commission (NERC). The NERC has now firmly established itself as the institution issuing utility licenses and regulator of prices and terms and conditions of producer-consumer relationships. Its efforts to raise tariffs have been thwarted by the Parliament. The NERC has strongly committed itself to a competitive, market-based system, while the Ministry of Energy has wanted to maintain Government control and ownership of the power sector, in spite of deteriorating conditions. Many in the Parliament, central government and local government have continued to see power as a service that should be provided at nominal cost, or free if possible, and likewise have expected that fuel, equipment and labor costs of the industry would nevertheless be financed.
USAID’s training and partnership programs have resulted in a significant shift of thinking and awareness and transfer of western practices for thousands of employees of the state-owned Ukrainian energy sector. Many trainees have advanced to positions of authority and are poised to make a real difference in the long-term.
In the coal sector, USAID has promoted health and safety awareness and practices regarding methane gas risks. Specifically, USAID has encouraged the development of coal-bed methane (CBM) as a commercially viable alternative source of energy. To that end, USAID’s contractor has identified the key legislative and regulatory issues and assisted in creation of the draft law "On Alternative Liquid and Gaseous Fuels" and "Production Sharing Agreements" affecting commercial exploitation of CBM. USAID collaborated with the Government of Ukraine in the creation of the Alternative Fuel Center to coordinate CBM activities.
As regards energy efficiency, USAID activities stimulated demand for energy audits provided by newly created energy service companies, developing linkages with energy efficiency industry of western countries. USAID collaboration with heating companies in the city of Lviv led to the installation by private sector companies of building-level heat delivery systems through condominium and cooperative associations. USAID has planned to continue its support to Ukrainian NGOs to extend this experience to five cities of Ukraine.
Through a continuing grant to the Department of Energy, USAID will provide business development assistance in industrial energy efficiency. In the framework of the Kharkiv Initiative, USAID will support development of a market for energy metering and conservation equipment. Energy efficiency and control of methane emissions can substantially reduce Ukraine’s impact on global warming. USAID supports the Ukrainian–U.S. Initiative on Climate Change, and USAID grantee -- Alliance to Save Energy -- will serve as the Secretariat for the Climate Change Initiative Work Group in Ukraine.
Possible Adjustments to Plans: In 1999, a comprehensive review of the Ukraine energy program was conducted. This review contributed to re-orienting the programs on privatization and to extending training programs. The review indicated that the influence of the Ministry of Energy is pervasive in the electricity market, and the only real solution is to diminish its authority and control.
Other Donor Programs: The primary donor program is the aforementioned Task Force. The World Bank is concentrating on policy reform. After suspending its Electricity Market Development Project (EMDP) last year, the World Bank is now close to approving a lending program for the Kiev City Administrative Buildings project, and has an on-going loan for hydro power plant upgrades and coal mine closures. The EBRD is another major donor in the energy sector, with several projects underway. EBRD has offered to be the lead financier for the completion of two nuclear generating units at Khmelnitsky and Rivne. Neither the World Bank nor the EBRD can provide significant technical assistance, although both can bring hundreds of millions of dollars in loan funds, as well as creative short-term financing (EBRD). Other donors include the Government of Japan, the European Union, the British Know How Fund, and Canadian Government.
Principal Contractors, Grantees or Agencies: Deloitte Touche Tohmatsu, Hagler Bailly, Alliance to Save Energy, Partners in Economic Reform, International Institute of Education and the United States Energy Association.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Number of electric distribution companies majority owned or managed by strategic investors
0 (1999) 0 0 7 20 Electricity revenue cash collection (%)
(%) Negligible (1995) 7.1 12 20 35 Commercial wells drilled for coal bed methane
0(1998)
0
0
1
2
Number of municipalities meaningfully involved in energy efficiency regional network 0 (1996) 0 1 4 9 Cumulative number of student days of training 0 (1996) 16170 32390 45310 51000 NERC functioning independently of political forces No (1998) No No Yes Yes Number of energy companies privatized by strategic investors* 0 (1996) 0 2 15 20 Reduction in industrial, residential and commercial consumption of energy 0(1998) 0 0 2% 5% __
* Reporting on indicator will be discontinued.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Increased Environmental Management Capacity forSustainable Development, 121-016
PLANNED OBLIGATION AND FUNDING SOURCE: $1,440,000 FSA
PROPOSED OBLIGATION AND FUNDING SOURCE: $1, 400,000 FSA
STATUS: Continuing
INITIAL OBLIGATION: FY 1999 ESTIMATED COMPLETION DATE: FY 2005Summary: USAID programs in support of this objective aim to increase public and private capacity to address critical environmental constraints to Ukraine's sustainable development. By and large, program activities are carried out at the local level, where the majority of decisions affecting Ukraine's economy and environment are taken by enterprises, utilities, schools, hospitals, local administrations, and citizens. USAID helps to create the necessary conditions and incentives for a greater private sector role in environmental technology transfer; and to increase and improve the technological environmental management capabilities of communities, and to increase environmental investment. Activities will promote citizen involvement in environmental decision making to ensure that both public and private entities balance environmental concerns with the need for economic growth and employment creation; and advance the understanding that improving local infrastructure, reducing pollution and minimizing waste increase economic efficiency and productivity.
USAID activities also support policy and regulatory reform with the goal of helping Ukrainians develop environmental policies that are both effective, and consistent with international agreements to which Ukraine is a signatory party. These policy-related activities are aimed at integrating environmental concerns into Ukraine's strategy for economic reform at national and local levels.
USAID activities under this objective will strengthen linkages among environmental professionals in the region, and between Ukraine and U.S. counterparts; particularly with a view to promoting environmentally sound technology transfer and public participation. Finally, USAID activities will assist Ukraine in meeting its obligations under international treaties, especially the UN Framework Convention on Climate Change and the UNECE Convention on Public Participation in Decision-making, Access to Information and Justice in Environmental Matters (Aarhus Convention). Activities under other objectives will assist in achieving environmental goals; i.e., USAID’s energy efficiency, private sector development, local government, democracy/rule of law, and health programs complement and reinforce the program to improve environmental management capacity.
The primary beneficiaries of these activities are the citizens of the areas in which USAID is implementing environmental activities – Crimea, Dnipropetrovsk, Donetsk, Ivano-Frankivsk, Kharkiv, Khmelnytskyi, Kyiv, Lviv, Mariupol, Odesa, Slavutych, and Zakarpattia.
Key Results: USAID will consider this objective met when Ukraine has (1) increased the integration of environmental and economic policies; (2) increased capacity to uphold commitments to international agreements; (3) improved environmental management practices at public and private facilities; (4) developed sustainable regional and U.S. environmental partnerships; and (5) increased involvement of citizens and environmental NGOs in the decision-making process affecting human health and the environment at the local level.
Performance and Prospects: Despite the critical state of Ukraine’s environment and economy, USAID has made significant progress under its environment program, and has established a solid foundation for further progress. Since 1996, the core of USAID’s environmental program has been the U.S.-Ukraine Council and Work Group Program to Promote Sustainable Development. This program initiated efforts to integrate economic and environmental development objectives. Field demonstration projects in urban water, agriculture, industry, energy efficiency, environmentally sound business development, and international treaties were linked to work groups that proposed legislative and policy solutions to barriers to sustainable development. USAID’s environmentally sound technology transfer activities have progressed in both the municipal and industrial sectors. In one case, USAID provided technology for the Lviv Urban Water Program. Elsewhere, local capacity to provide water services was increased from 0-3 hours per day to 24 hours per day in one area through the transfer of U.S. Environmental Protection Agency, computerized water system modeling technology, U.S. engineering technologies, and financial management and efficiency know-how in the industrial sector. USAID projects helped to generate $3.4 million in annual savings in ten Donetsk and Dnipropetrovsk enterprises, and improved energy efficiency in 24 enterprises.
The number of viable, environmental, non-government organizations (NGOs) in Ukraine increased as well. The NGO network has grown from a membership of approximately 150 in 1994 to 619 in 1999, an increase of 413%. The focus will now shift to building institutional capacity within these organizations and to coordinating these efforts with the establishment of the new Regional Environmental Center (REC).
In FY1999, the Mission and the Government of Ukraine agreed to work with UN Development Program to sustain the Work Group Program with increased Ukrainian leadership, greater involvement of other donors, and reduced support from USAID.
As noted below, the Urban Water Program is now implemented under the objective to improve local government. USAID plans to replicate this program in other municipalities. USAID does not provide direct funding for activities in waste minimization; but provides Ukrainian municipalities and businesses access to such funding through the Europe and Eurasia Bureau’s regional EcoLinks program. Energy efficiency activities under will be addressed in the context of reducing greenhouse gas emissions under the Climate Change Initiative.
USAID’s support for environmental NGOs and for citizen participation will continue under the Climate Change Initiative and under a new activity: the Local Environmental Action Program (LEAP). The LEAP will assist communities in addressing local environmental problems, and increasing public participation in environmental decision-making. The Climate Change Initiative and the LEAP will be the Mission’s principal activities under this environmental management objective FY 2001.
Possible Adjustments to Plans: Activities under this objective were reviewed in the first and second quarters of FY1999, resulting in the decision to pursue two environmental management goals under two other strategic objectives. Municipal infrastructure activities are now deployed as part of the overall strategy for improving local government management and services delivery. Energy efficiency activities aimed at reducing harmful emissions are now being implemented as part of the overall energy program.
Other Donor Programs: USAID works closely with The World Bank, European Bank for Reconstruction and Development, and other donors, especially with the Government of Canada in the area of global climate change. In implementing the LEAP, the Mission expects to cooperate closely with the Environment for Europe Environment Action Plan Task Force and its Secretariat at the Organization for Economic Cooperation and Development. Increased cooperation with the European Union is likely now that the REC has been established in Kiev.
Principal Contractors, Grantees or Agencies: UN Development Program (UNDP), U.S. Environmental Protection Agency, Environmental Research Institute of Michigan (ERIM), Hagler Bailly, UNECE, and Institute on Soviet-American Relations.
Selected Performance Measures
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Number of projects prepared for environmental investments
0 (1997) 0 NA 2 3 Number of local environmental action plans adopted
0 (1997) 0 NA 1 6 Number of actions taken by Ukraine to implement the UNFCC and/or Aarhus Convention
0 (1997)
5
NA
7
8
Number of private and public entities that have adopted environmental management plans* 19 (1997) 31 53 65 80 Number of laws and regulations adopted that strengthen the policy, legal and regulatory framework for environmentally sustainable development 0 (1998) 0 ** ** ** Number of private and public entities innovative financing mechanisms 0 (1998) 0 ** ** ** __
* Formerly "… improved environmental management."
** Reporting to be discontinued.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Increased Better-Informed Citizen Participation in Political and Economic Decision Making, 121-021
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $6,319,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $6,000,000 FSA
STATUS: Continuing
INITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2005Summary: This program advances democracy and the emergence of a market economy in Ukraine by stimulating effective citizen participation. After eight years of independence, the enabling environment for democracy in Ukraine remains weak. Political will among government leaders for reform is tentative. Many fundamental changes are needed in laws, institutions, attitudes and practices. USAID supports active, grassroots NGOs that assert citizen rights, aggregate and advocate popular interests, and contribute to broad debates on public policy. In addition, this program encourages an independent and unrestricted press that can provide citizens with unbiased information and a broad range of ideas. Programs activities include those that help Ukrainians build expectations and mechanisms of accountability and transparency in government. Other activities train citizens to become more politically active. Finally, through USAID assistance, political parties receive training to increase their capacity to build and maintain links between citizens and their representatives at all levels of government.
Key Results: Achievement of this objective is contingent on success in effecting: (1) increased public confidence in the political process as a result of the improved ability of NGOs and other civil society groups to advocate citizens’ interests, and improved citizens’ representation in government through free and fair elections; and (2) more unbiased, public information available to citizens as the result of increased transparency of government operations and more professional and independent media reporting.
Performance and Prospects: Participation in NGOs is increasing. Due to USAID’s support for NGOs working for free and fair elections in 1999 (primarily the Freedom of Choice Coalition), supporters of democracy are better organized and working more closely with each other. Efforts by these NGOs help explain a significant increase in youth voter turnout for the 1999 elections (compared with the parliamentary elections of 1998). Elections were free and fair. USAID-funded, International Foundation for Electoral Systems (IFES) technical assistance is a major reason that the administration of these elections was basically free and fair. Data confirm that training and technical assistance to help independent media outlets become more financially independent is working, and citizens have better access to more sources of information. However, heavy-handed harassment of the media and state interference in the election compromised these successes. It is disappointing, although not surprising in view of the slowness of reform, prevalence of corruption, and poor reputation of national leaders, that nationwide polling data show Ukrainian citizens continue to lack confidence in the political process.
Ukraine has made some progress in its democratic transition. A number of reform-oriented public policy NGOs have become significant actors, impacting debates about legislation and the reform agenda. Advocacy to enforce citizen rights under environmental legislation continues to make gains. In Odessa, the city government fixed broken sewer pipes and promised a clean up when faced with a lawsuit demanding monetary damages for flouting the law. The highest courts continue to demonstrate willingness to rule against the Government, and the number of active non-governmental organizations continues to grow. The administration of elections, as seen in the presidential elections of 1999, has improved dramatically under the guidance of USAID-supported, IFES specialists. Those elections were judged generally free and fair, and the President, re-elected against a Communist challenger, has promised "resolute reforms," and has appointed a reform-minded banker as his new Prime Minister.
The enabling environment for democratic and economic reform in Ukraine appears to be more positive now – due to Ukraine’s own democratic forces, as well as pressures and support from international donors. The program is at a critical juncture: the prospects for continued reform are uncertain, and the role of USAID assistance extremely important. Despite setbacks and remaining challenges, there has been both an opportunity and a danger in the lack of political consensus for reform in either the Government or the Parliament. In the Parliament, anti-reform forces have remained strong, and while they have not commanded a majority they have blocked many pro-reform projects. Reformist political forces in parliament have been fragmented and have yet to pass some key progressive legislation, such as measures to protect free speech through caps on libel suits brought against journalists or through acceptance of a "public figure" doctrine. In addition, reformist forces failed to block some backward steps, such as a new law that constitutes the de facto end of a national free trade union movement.
Legislator coalitions and strategies could become more sensitive to citizen lobbying and pressures for reform, which will increase steadily as the country prepares for parliamentary elections in 2002. Predilections for control among current elites continue to intimidate those who want change, or who would make demands on Government. The experience of State pressures on the media during the 1999 presidential election campaign as well as widespread use of State employees to promote the incumbent bear out these feelings of intimidation.
The situation with the media has remained especially serious. Non-State media faced increasing difficulties in providing unbiased information to the public and operating free of governmental and financial pressure in the pre-election period. Harassment, buy-outs, and personal attacks on journalists all combined to coerce the media – especially those with a national reach -- into a subdued role. According to both domestic and foreign monitors of media performance, programming was lopsidedly partisan in favor of the incumbent; some television stations were shut down or bought out. Twenty-five of the 64 member stations of the Ukrainian Radio Broadcasters Association reported that they received anonymous threats or were harassed by tax authorities during the campaign. While some independent media outlets in the regions escaped such pressures, on balance this year was a sobering one for defenders of free speech in Ukraine. These election year constraints detracted from the successes of USAID programs to support free media – a three-pronged effort that not only promoted financially independent media and technically skillful journalists but also responsible and ethical journalism.
The task of democracy promotion has continued to pose challenges, and gauging success is has not always been easy. For example, USAID at one time used "legality of domestic election monitoring" as an indicator of free and fair elections. In the 1999 elections, domestic monitoring by citizen groups was technically illegal, yet extensive citizen monitoring in fact occurred and marked a high point in pro-democracy activism in Ukraine. Altogether over two rounds of voting, USAID-supported programs helped to train and deploy over 55,000 election monitors. The Presidential Election Law in fact did not provide for civilian monitors, nor would Parliament amend the law to do so, despite some heavy lobbying. But the law did provide for monitors from political parties, candidates, and journalists. So, in what may be a peculiarly "Ukrainian" solution, the Committee of Voters of Ukraine (CVU) recruited about 15,000 non-partisan civilian monitors, and gave them all cards accrediting them as "journalists" from the CVU’s own newspaper – all with full prior knowledge of sympathetic election authorities.
One good sign has been that citizen interest in fair and democratic procedures is stronger than ever. USAID supported the efforts of an impressive, nation-wide, non-partisan coalition of 268 Ukrainian NGOs that was formed in 1999 to support free and fair elections. Their work was at least partly responsible for the astonishing turnout among young voters – up from about 35% in the 1998 parliamentary elections, to over 65% in the 1999 presidential elections. Member groups of this coalition found their cooperative experience very satisfying, and many of them have resolved to continue civic work in the future with a new focus – perhaps, anti-corruption. The success of the coalition energized public policy NGOs and think tanks that have now planned to intensify their efforts to encourage policy-makers to adopt badly needed reforms. Such efforts made sense in the aftermath of elections that the Ukrainian president himself says gave him a mandate to move more quickly.
Plenty of evidence exists that political activists – especially at the local level – are eager to do more to promote democratization and to involve citizens in governance. Some of this impetus is related to the tension created by acute social need and impatience with the current pace of government action. Other reasons are demographic: of over 240,000 elected officials below the national level, less than 5% have a formal party affiliation, while about 20% are under 30 years of age. USAID-funded programs in political party building, legislative development, and municipal governance successfully engage many of these people through workshops for locally elected officials and issues seminars, as well as through training in lobbying, constituency relations, and leadership. Requests for training from these locally elected officials are increasing – a demand for help USAID cannot ignore.
Programs to press for democracy from below – and through elected representatives -- can become politically critical over the next few years as Ukraine’s leadership weighs the domestic benefits and risks of a more robust reform agenda. Not funding new efforts to support civil society NGOs would risk losing the momentum of civic activism generated during the elections, and the organizational gains of the many participants all over Ukraine.
Over the next four years, USAID will attempt to respond to the increased demand for assistance from civil society NGOs that want to assert, defend, and advocate the rights of citizens. USAID will support workers and journalists to help them mobilize their membership and general public, respectively to lobby for reforms. Finally, USAID will work with individuals and groups eager to take an active part in political life. An assessment of political party-building activities will take place early in 2000. Conclusions and recommendations from this assessment will help guide plans for continued political process activities leading up to the 2002 parliamentary elections and beyond. Building on the evaluation of the American Center for International Labor Solidarity, labor union support program that ended in October 1999, and on the experiences of election-period civic activism, USAID intends to introduce a new program for civil society NGOs and advocacy in mid-2000. This program will ensure that the momentum of democratic activism experienced in 1999 will not be lost. It will help civil society organizations identify pressure points for reform in all sectors and then enable them to sustain momentum for reform from the grassroots.
Possible Adjustments to Plans: No strategic changes identified at this time.
Other Donor Programs: Several other donors work to promote civil society, and support activities to democratize the political process. The major contributors to the 1999 election effort include the European Union; the International Renaissance Foundation; Netherlands, Canada, and Great Britain; and the United Nations Development Program. The European Union and the British Know How Fund intend to expand their existing programs of assistance to civil society activities over the next few years. USAID leads the ad hoc meeting of donors that coordinates assistance during elections, and participates in donor coordination groups for other sectors, including NGOs and independent media.
Principal Contractors, Grantees or Agencies: International Foundation for Electoral Systems, International Republican Institute, National Democratic Institute, Freedom House, Internews, International Research and Exchange Board, Counterpart Alliance for Partnership, Eurasia, and the NIS-U.S. Women’s Consortium
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Citizens understand the political process
17% (1996) 30% 28% 30% 35% Citizens who believe they can do something about an infringement of their rights by the government
6% (1995) 4% 15% 17% 19% Citizens participate in NGOs
16% (1996)
14%
25%
28%
30%
Draft national legislative initiatives introduced by legislative branch in which there was citizen participation in the deliberative process* 0 (1995) 6 3 20 30 Medium and large cities with coverage of daily national news by non-government TV stations 16% (1996) 23% 23% 24% 24% __
*Formerly "Draft national legislation introduced…"
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Legal Systems that Better Support Democratic Processes and Market Reforms, 121-022
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $2.320,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $3,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2005
Summary: This program supports efforts to create an entirely new, Western-oriented legal system, and transform the existing political-legal culture. Activities have included direct assistance to: parts of the judicial system itself; members and staff of Parliament; judges and lawyers in their individual professional roles; juridical associations, law schools and legal educational institutes; and to NGOs engaged in legal advocacy.
In the past, USAID supported activities to strengthen the institutional capacity of the courts and the Parliament, assisting these branches of government to fulfill their constitutionally established roles. These activities cultivated legislative professionalism, working with those in Parliament willing to improve the Parliament’s commitment to and skill with its representational and oversight functions. Activities to bolster the effectiveness of the court system, through training of judges, technical assistance and limited equipment purchases (e.g. computerization and access to legal databases) were key components of USAID's broader effort to reform Ukraine's legal system (a program that ended in September 1999). In addition, USAID supported legal advocacy groups that lobby for adherence to the rule of law. This activity includes legal assistance to journalists, aid to pro-bono clinics at law schools, and an active program to encourage professional education among lawyers.
The absence of a coherent statutory framework is a significant obstacle to legal reform. Therefore, USAID’s future legal reform strategy will consolidate and build on the gains of past activities while trying to achieve more discrete objectives in the following areas: anti-corruption; the adoption of select laws, codes and other essential legislation; and legal advocacy in support of human and environmental rights and media freedom. USAID’s success in these areas will impact legal systems more comprehensively.
Key Results: USAID’s mission under this objective will be achieved when: (1) courts carry out their role as ascribed to them by law; (2) the constitution, civil and criminal codes, and supporting legislation meeting international standards, are enacted; and (3) citizens hold government accountable to the laws.
Performance and Prospects: The foundation for a Western-based legal system was laid with the adoption in 1996 of Ukraine's new post-Soviet constitution, a generally progressive document that guarantees citizens an impressive set of rights and establishes the structures of national government. USAID has acknowledged that transforming institutions and mindsets represents a long-term undertaking and that work has just begun to put in place a legal system suited to the needs of a modern democratic, free-market system. Ukraine must meet the next challenge: to design and adopt new codes and laws to replace the old Soviet-era statutes that continue to regulate almost every aspect of Ukrainian life.
But progress in discrete activities does not provide a full picture of the changes, some admittedly difficult to measure, that have begun to take hold in constructing a legal system more supportive of democratic processes and market reforms. Though the Constitution establishes an independent judiciary, judges at the local level are only now beginning to see themselves as part of an independent, co-equal branch of government. The same can be said for members of the Parliament. Despite the inefficiency of its internal procedures and its lukewarm support for economic reform, the Parliament is also emerging as a prominent actor in national policy making. In both cases, USAID and other donor-supported programs to bolster the institutional capacity of the courts and the Parliament are contributing to an emerging sense that these bodies should be co-equal partners in the governing process.
Efforts to improve legislative procedures in Ukraine have produced some results; e.g., in the increasing use of committee hearings that involve representatives of the public, and in greater involvement of parliamentary committees and their expert staff in drafting important legislation such as the budget. Provision of pro-bono legal services continues to increase the public’s access to competent counsel while it offers practical training to new young jurists. The specialized, pro-bono assistance offered in matters of environmental law continues to expand its reach. Community-based programs to promote government integrity and to fight corruption have been established in two cities, and will soon begin in a third. As for the court system, the continued independence of the higher courts is very positive. For example, the Constitutional, Supreme, and High Arbitration Courts are on record for having all issued decisions against the executive branch that by most accounts demonstrate a high degree of independence from the executive or legislative branches.
Unfortunately, USAID’s expectations for further modernization of the legal system have been frustrated by the lack of fundamental legislation essential for economic and democratic reform. In addition, Ukraine has yet to pass certain legislation needed to satisfy Council of Europe membership requirements. Despite pressure from supporters of reform both inside and outside the country, Ukraine has yet to adopt the Law on the Judiciary and several codes – a new civil code and code of civil procedure, administrative code and code of administrative procedure, a revised criminal code and code of criminal procedure, and the law on the procuracy.
The change that may have the most profound long-term consequences is the increasing ability of citizens, primarily through NGOs, to use the court system to hold government authorities, particularly at the local level, accountable for observing the rule of law. For example, one USAID project supports a coalition of environmental NGOs that attempts to hold government accountable to environmental and public participation laws. The resulting efforts by citizens and NGOs to use their rights under the law are highly successful, advancing an issue of primary concern to citizens while increasing their confidence in the political process and legal system. Similar projects that provide legal and advocacy support to journalists, members of independent trade unions, and special interest groups such as consumer and business associations, have impressive, albeit limited success. This trend is greatly abetted by growing awareness on the part of citizens about the law, and by the increased access to competent legal representation and increased citizen access, in part through USAID-supported, pro-bono legal clinics. Increasingly, consumer rights, human rights, environment, and small business NGOs are engaged in legal advocacy.
Possible Adjustments to Plans: USAID carried out a rule of law assessment in 1999, and has been redesigning its rule of law programs to fit the central recommendations of this assessment and build on lessons learned. Under current funding projections, resources available to support rule of law programs will fall to less than half previous levels. From FY 1996-FY 1999, the budget for the rule of law program averaged approximately $4.8 million per year. For FY 2000, the proposed budget for the rule of law program is a little more than $2 million. From this total, $1 million will be budgeted to expand anti-corruption activities, based on the positive results of the two, well-established, community-based integrity partnerships in Donetsk and Lviv. USAID plans to fund a newly established, nation-wide, anti-corruption NGO coalition. This coalition will coordinate the efforts of the public, media, and local governments to fight corruption at the local level. The coalition is expected to make a valuable contribution to these efforts and advance networking among civic organizations.
Other Donor Programs: USAID continues to coordinate with the World Bank, the European Union technical assistance program for Eurasia, the Organization for Security and Cooperation in Europe, and other donors on legal reform issues. Most notably, USAID’s programs are designed to complement the proposed World Bank Legal Reform loan, which has been under negotiation for several years. USAID organizes and participates in donor meetings to coordinate assistance to the courts, parliament, and specific legislative drafting initiatives. Coordination meetings often include Ukrainian government counterparts as well as NGO development partners such as the Ukrainian Legal Foundation.
Principal Contractors, Grantees or Agencies: American Bar Association/Central and East European Law Institute, Indiana University, and Management Systems International.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Number of target laws:
Drafted
6 (1998) 6 8 9 9 Introduced
3 (1998) 3 7 9 9 Enacted
1 (1998)
1
5
9
9
Constitutional Court functioning independent of other branches - ruling against the Executive No (1995) Yes Yes Yes Yes Citizens aware of basic human and civil rights 25% (1997) 15% 31% 43% TBD Number of operational Pro-Bono legal clinics 1 (1997) 7 8 11 15 Number of clients of EPACs receiving pro-bono consultations 134(1998) 134 300 330 370
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: More Effective, Responsive and Accountable Local Government, 121-023
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $2,800,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $3,500,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2005
Summary: Improved capacity of local governments to manage resources and provide service is crucial to sustaining Ukraine’s overall reform effort. Assistance at the local level not only has visible impact on people’s lives, but also improves public perceptions of and experience with democracy and economic reform. In cities, towns and villages, the interaction between citizens and government is most vigorous. There is evidence that local governments with the capacity to exercise well-informed choices -- in partnership with citizens and civil society -- can solve problems, identify and maximize opportunities, narrow the gap between resources and responsibilities, and engage the central government on policies that encourage local initiative.
Many of USAID/Kiev’s programs that support democratization, housing, finance, privatization and private enterprise, environment, health, and training have taken place in or directly benefited cities or towns. In over 395 Ukrainian communities, USAID/Kiev is working at the grassroots level with citizens, NGOs and local governments to bring about positive change.More than1,000 community-based activities help to build responsive, well-run communities and increase public confidence not only in local government but also in the transition to a free-market economy and democratic society. These efforts help bring about tangible improvements in people’s lives. Strengthening local government capacity and encouraging citizen participation at the community level is the key to the sustainability of these efforts.
The strength of USAID’s approach lies in the fact that U.S. programs produce tangible evidence that priority community concerns can be addressed more effectively through local government initiative and citizen participation. USAID will continue to build upon experience to date in promoting, at the local level: (1) democratic governance that is transparent, accountable, responsive, effective and engages citizen participation; (2) improved fiscal and financial management, including the development of operating and capital budgets, financial planning, business and investment plans, and economic development plans; (3) improved management capacity and administrative practices; (4) improved municipal services delivery and tariff reform, including improvement in the quality of service and the efficiency of service provision, particularly in the areas of heating and water/sewer; and (5) continued strengthening of the Association of Ukrainian Cities as the advocate and professional association for local governments.
These programs are mutually supportive of programs under other strategic objectives that increase citizen participation, build citizen confidence in political processes, and strengthen the rule of law. In addition, the restructuring of the intergovernmental finance system through the fiscal reform objective will make an essential contribution to the achievement of improved, local government administration. Finally, as municipal development is truly a cross-cutting area, objectives and special initiatives in economic growth, small- and medium-business development, environment, and health that promote development, or address citizen needs and concerns at the local level, reinforce the efforts of activities under this objective.
The principle beneficiaries of these programs are mayors, city administrators, local government officials and policy makers through increased local authority and improved management. The citizens of these communities benefit through improved services, greater transparency of government operations, and more involvement in local planning, decision-making processes and implementation.
Key Results: USAID will consider progress towards the achievement of this objectiveon track when targeted local governments and citizens begin to work together to solve priority community problems, and identify opportunities for future development. These efforts will help bring about tangible improvements in municipal planning and administration, and in service delivery. Sharing positive experience and lessons learned with other local governments in Ukraine and in the region will facilitate the duplication of effective approaches in other localities, enabling a broader impact of USAID programming.
Performance and Prospects: While local governments in Ukraine continue to face significant challenges, USAID has made progress that will serve as a foundation for continued development of local government. USAID-sponsored activities have promoted more open and responsive city government operations, public accountability of local officials, improved municipal services, open and competitive procurement procedures, and increased citizen participation. USAID has provided local governments with training and technical assistance in management, financial and strategic planning, municipal operations and services, budgeting and citizen participation through in-country and cross-border exchanges with public and private organizations.
As verified recently by an evaluation of two major activities, dramatic improvements in ten communities’ transportation services resulted in significantly improved public perception of local government, and nine cities also adopted financial and budgetary analysis methods to help exercise their new authority to raise revenue and plan expenditures. Forty percent of cities (in the population range of 50,000 to one million) are using financial analysis models developed with USAID support. Twelve cities have achieved measurable improvements in municipal services (transportation and water). Seventeen percent of the cities (in the same population range) are using strategic development planning tools. Fifteen cities have established citizen task forces and advisory boards. Twenty-two cities have held public hearings and "town hall" meetings on a consistent basis, with a total of 37 communities improving their citizen participatory mechanisms by creating and utilizing task forces, advisory boards, etc. as well as holding public hearings. Eleven cities are using competitive procurement on a regular basis. USAID assistance also improved the computer literacy among city and trolley bus company employees in 31 cities.
Eighteen Ukrainian cities are paired with U.S. partner communities for technical assistance, education and training exchanges, supported by four regional training centers. The focus areas of the partnerships include economic development, citizen participation, transportation, housing/communal services and budget. To date, we have seen some progress in the adoption of financial analysis models and in the holding of public hearings. Other accomplishments include 31 local government officials interning in 12 American communities; post-internship follow-up trips by 31 U.S. trainers in eight Ukrainian cities; and 40 seminars at the training centers which provided training for 750 local government officials from more than 125 communities.
Laws on local, self-government and local state administrations were passed in 1997 and 1999 respectively. The USAID-supported, Association of Ukrainian Cities (AUC) assisted in drafting the local self-government bill and continues to assist in the development of and lobbying for bills regarding local taxes and fees, communal property rights, the State budget and budget system. AUC’s membership continues to grow (from 79 in 1996 to 270 at present), and it has become more effective in its advocacy for local government issues and concerns at the national government level. USAID is also working with AUC to develop and disseminate lessons on best practices in Ukrainian local government.
The Urban Water Improvement Project in Lviv introduced a successful model for financially viable and sustainable water utilities which was rolled out to two other cities. Some of the results included a significant improvement in the Lviv water supply for about 50,000 citizens, and increased the energy efficiency of its potable water supply. USAID also is assisting the Lviv water utilities to apply for a World Bank loan. The successes of the Lviv Urban Water and the Effective Local Government activities are being implemented in a new Municipal Water activity which will assist eight water utilities to improve their technical, financial and management capacity, while involving the community and local government in this process.
The Municipal Development Loan Fund activity recently resulted in two communities, with the assistance of citizen task forces, developing economic development strategies, followed by two business plans and two major infrastructure project proposals for each community. These communities are now better positioned to apply for loans from major financial institutions, such as the European Bank for Reconstruction and Development (EBRD), or from the future World Bank Municipal Development Loan Fund.
These activities have demonstrated that increasing local government capacity to manage and promote democratic processes and transparency can bring about tangible improvements that build citizen support for local government and for reform. The interest in replicating USAID models and approaches in other cities confirms not only the success of these programs, but also the opportunity to make a significantly broader impact. In addition, a Work Group is finalizing an activity design for tariff reform (focusing primarily on the national level) and the restructuring of communal service enterprises (focusing on local water and district heating).
Possible Adjustments to Plans: These programs have recently undergone strategic review, and no adjustments are contemplated for the present.
Other Donor Programs: Many donors and international organizations are working to strengthen local government, but USAID has the most comprehensive and geographically diverse program. The World Bank, other than the pending loan for the Lviv water utilities, is implementing the Kyiv Public Building Energy Efficiency and Sevastopol Heat Supply Improvement projects. Several other donor organizations, including EBRD, the European Union (EU), the British Know How Fund and the United Kingdom’s Department for International Development (with the Organization for Economic Cooperation and Development), have projects to improve the water and wastewater companies’ financial and operational performance. The UN Development Program will also be looking at municipal water tariff setting and collection in Ukraine. In addition, International Renaissance Foundation and the EU award small grants to NGOs and others to strengthen local governments and civil society. Twinning programs are sponsored by British Know How Fund and EU as well. Lastly, British Know How Fund is beginning a local and regional government institutional strengthening project to help improve delivery of local services.
A Municipal Development Working Group has been established and meets regularly to discuss donor coordination. Participants include representatives from the organizations noted above, as well as representatives from the German, Swedish and Dutch embassies and several foundations (such as Eurasia).
Principal Contractors, Grantees or Agencies: USAID implements activities through U.S.organizations, including theU.S.-Ukraine Foundation, Research Triangle Institute, CH2MHill and International City/County Management Association
Selected Performance Measures
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Cities with municipal business plan
0 (1998) 0 2 4 6 Cities using financial analysis models
0 (1995) 32% 40% 45% 50% Cities with improvements in specific Services
12 (1998)
12
14
16*
18
Cities with institutionalized participatory mechanisms 1 (1995) 6 15 17** 19 Citizen's access to decision-making fora ensured 0 (1998) 11 22 25 30
__
* Source data and 2000 target revised.
** Target revised in September 1999.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Improved Sustainability of Social Benefits and Services, 121-032
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $9,262,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $10,000,000 FSA
STATUS: ContinuingINITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2005
121032a: Pension Reform and Social Services
Summary: Ukraine's transition from Soviet-era, central planning and authoritarian rule has imposed substantial hardship on the vast majority of the population. As price controls were lifted, food, housing, energy and other basic goods and services were no longer affordable to people dependent on either government pensions and invalid benefits or fixed wages. The Government of Ukraine printed money to cover budget deficits, igniting explosive bouts of inflation, and wiping out savings families had accumulated over many decades. As a result, many of the elderly were left without a cushion to protect themselves from new economic realities. The abrupt end of the arms race placed millions of manufacturing employees on indefinite lay-offs, or in part-time employment. With economic growth still elusive, few people have had access to proper jobs. The absence of a financial sector to redirect investment funds stifled the growth of new opportunities. Endemic corruption, punitive taxes, intrusive regulations, and xenophobia reduced the level of foreign investment. Worsening budget deficits froze pensions and other government benefits far below subsistence levels. Shrinking State support in the health sector compromised historically free health care, reducing its quality and eliminating its "free" price. Increasing morbidity and mortality, and declining life expectancy reflect th starkest results of these developments.
Improving the sustainability of social benefits and services would help strengthen political support for economic reform in Ukraine. With over half of Ukraine’s population living below the poverty line, such support, already dwindling, will soon evaporate if measures are not taken to shelter the most vulnerable groups in society. Ukrainian citizens cannot be expected to envision and aspire to a more promising future when their immediate welfare is in such a precarious position. The new poor resent the bewildering "reforms" that have destroyed their living standards. They are turning to political parties calling for a "return to the normalcy" of socialism. These parties are effectively slowing or even blocking reform. further exacerbating social and economic problems and discouraging foreign assistance.
USAID assistance is aimed at: (1) building a firm, rational and consistent legal, regulatory and administrative framework to support the three-pillar pension system, including the solidarity system, the beginning of a mandatory funded system and safe, voluntary, private pension plans; (2) developing sound actuarial pension models to allow accurate evaluation of alternative pension reform scenarios and better management of the state pension system; (3) assisting in the creation of a national database of all pensioners to allow automated pension calculations, auditing of pension expenditures, and reduced administrative costs; (4) creating a nationwide database of all working Ukrainians to improve collection of payroll contributions, eliminate workbooks, improve labor mobility, and allow auditing of all social protection programs; (5) creating a nationwide unified social safety net program; and (6) improving the infrastructure, management capacity, organizational government structures of indigenous NGOs providing social services to vulnerable groups in society, and improving the legal and regulatory environment in which they operate.
Because the social welfare of the population is so closely tied to many spheres of life, activities in practically every other USAID objective contribute to the achievement of this one; particularly private sector development, increased citizens’ participation and government responsiveness, and health sector reform activities.
USAID will help the Government of Ukraine (GOU) to replace the present fragmented system of targeted assistance programs with a unified social safety net program for the people of Ukraine, using the Mykolaiv oblast model of social protection services delivery. All benefits will be targeted to the most needy families and individuals. Efforts are expected to yield such benefits as budget savings of between 200 million and 400 million hryvnia by FY 2003, depending on the extent to which benefits are increased to the poorest families. Beneficiaries of these programs include low-income, Ukrainian children and adults, especially pensioners and single women with children. Ukrainian NGOs and charity organizations, hospitals, orphanages, boarding houses, invalids, the elderly, and most other vulnerable groups also benefit from USAID assistance under this objective.
Key Results: USAID will consider this objective achieved when the following conditions attain. (1) There is increased efficiency in public sector delivery of services. (2) The public pension system is reformed and its infrastructure capacity strengthened. (3) Private pension insurance is implemented. (4) A nationwide social safety net program has been created. (5) NGOs and other private organizations provide needed services to vulnerable groups. (6) There is effective delivery of emergency and humanitarian assistance.
Performance and Prospects: Despite a number of formidable obstacles, Ukraine, with the help of foreign donors and international financial institutions, has made some headway in creating more sustainable social benefits and services in selected areas. Working closely with GOU counterparts in key ministries, USAID has helped to design and implement a number of social sector reform programs and more generally has catalyzed Government support of social sector restructuring. Since 1995, USAID has contributed to important social sector reform achievements, including improved cost recovery for housing and communal services, saving the state budget an estimated $1 billion per year.
USAID was also instrumental in a successful housing subsidy program, including the introduction of automated caseload management and financial reporting systems, which provides targeted assistance to some four million poor families. USAID technical assistance helped create the models to forecast unemployment insurance and employment fund revenues and expenditures as well as the training for relevant staff to use the model. USAID helped pilot a quarterly household labor force survey, coordinated with the IMF/World Bank's revised household budget and expenditure survey. In addition, USAID assisted in creating a system for monitoring the social protection needs of the population – specifically one for reporting wages and contributions to the State Pension Fund – which improved tax collections, related pensions to employment history, and could lead to the eventual elimination of work books.
Overall, USAID technical assistance produced fiscal models for accurate budgeting of social assistance programs. Finally, USAID has provided grants and training to social service NGOs, which have helped increase the efficacy in strategic program planning and implementation, cross-sectoral cooperation with government and business, fund-raising, advocacy. As a result, NGOs experienced a nearly tenfold increase in client base and diversified their funding sources.
USAID’s social sector reform strategy will build on these achievements to create an efficient and effective social benefits and services system that will include reform of the state pension system and the introduction of viable private pension funds. In addition, USAID will facilitate the creation of an NGO network, which will in turn provide humanitarian assistance to address problems of acute human suffering during the transitional period. For the foreseeable future, USAID will support efforts to build a sustainable network of public, private and non-governmental Ukrainian institutions, whose mission is to alleviate the privations of the most vulnerable Ukrainian citizens, imposed on them by the economic and political reform process.
Possible Adjustments to Plans: These programs have recently undergone strategic review, and no adjustments are contemplated for the present.
Other Donor Programs: Other donors recognize the importance of social sector reform in Ukraine as well. International Monetary Fund conditionality includes requirements for better targeting of social assistance, the elimination of general entitlement programs, as well as improvement of state pension system administration. The World Bank continues to explore the possibility of providing credits to support pension reform, having expressed a willingness to collaborate with USAID on phasing in some elements included in USAID’s pension reform strategy. The European Union's technical assistance program for Eurasia ( EU TACIS) provides training and policy assistance in the area of pension reform and is currently collaborating with USAID contractors in developing the social safety net. The British Know-How Fund is also developing a scope of work for a modest program to support targeted assistance.
Bilateral donors --- including regional German Governments, the Government of Canada and the British Know-How Fund -- are also engaged in pilot projects related to improvements in the state pension system and active labor programs to create jobs and retrain workers. USAID works closely with other donor organizations in NGO development, particularly through a Donor Working Group, which includes EU-TACIS, UNDP, the Netherlands Embassy, British Council, the Mott Foundation and the International Renaissance Foundation (Soros). One of the projects the donor group has developed is a database to track all NGOs that apply for or receive assistance from any member of the donor community. This information will provide background on the NGO for purposes of coordinating efforts and checking on the NGO’s history and reliability. A separate database, on which the British Council has taken the lead, provides information on the different donors and programs. The public will be able to access this information on the Internet throughout the NGO Resource Center network.
Principal Contractors, Grantees or Agencies: PADCO, Gavin Anderson and Counterpart (CAP and CHAP)
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Law on mandatory state pension insurance enacted
No (1997) Drafted Drafted Yes Yes System for delivery of social protection services has been replicated nationwide based on Mykolaiv oblast experience (% completed)
0 (1997) 0 30 70 100 Percent NGOs that increased Number of beneficiaries
60 (1998)
160
85
*
*
Share of social assistance spending which is targeted (percent) 5% (1995) 50 40 45 65 Law on non-state pension funds enacted No (1997) No No Yes Yes Private pension funds regulatory agency established No (1997) No No No Yes ____
Reporting on this indicator to be discontinued once 85% target achieved.
ACTIVITY DATA SHEET
PROGRAM: Ukraine
TITLE AND NUMBER: Improved Sustainability of Social Benefits and Services, 121-032
PLANNED FY 2000 OBLIGATION AND FUNDING SOURCE: $9,262,000 FSA
PROPOSED FY 2001 OBLIGATION AND FUNDING SOURCE: $10,000,000 FSA
STATUS: Continuing
INITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2005121032b: Improved Health Care Service Delivery
Summary: Since the collapse of the Former Soviet Union, much of the old government and social structure supporting health care has become increasingly dysfunctional, while the overall risk to the health of the Ukrainian population has continued to rise. One alarming statistic which is indicative of the worsening health situation is the decline in life expectancy for the Ukrainian population, from 69.7 in 1991 to 67.1 in 1996, with the reduction for females being from 74.3 to 72.8 during that period, and for males from 64.7 to 61.6. Much of the decline in health and increased risk can be attributed to lack of preventive care, lack of disease management (infectious, degenerative, cardio-vascular, circulatory, cancers and congenital and peri-natal), poor lifestyle choices, adverse environmental and occupational health conditions, and accidents. Birth rates are below replacement levels. However, the infant mortality rate remains high, and abortion is still the most common method of fertility control in Ukraine.
USAID began working in the health sector in Ukraine in 1993, and has provided technical assistance and training in seven priority areas: reproductive health, infectious diseases, pharmaceutical management, hospital technical assistance, breast cancer, Chornobyl-related childhood illnesses and health care financing. Reflecting on this effort and looking forward to the opportunities for greatest impact in the future, USAID has developed a comprehensive health care strategy to support improvement in the quality of health (health status) and the quality of health care (health care system) for the population of Ukraine. Elements of that strategy include assessment of: individuals’ health status and modalities needed to improve it; and, the health care system and the modalities needed to make it more efficient, effective, and sustainable. Opportunity for international technical assistance is employed to leverage significant change.
The health care problem remains daunting.Effectiveness is hampered by the ingrained culture of health care funding and allotments based on hospital bed occupancy. Weak financial management perpetuated by both a lack of adequate funding and a lack of a well-trained cadre disciplined in modern managerial science is also an impediment. Additional weaknesses include emphasis on a large number of specialists and not a reasonable proportion of General Practitioners for robust primary health care. The majority of health care is being provided at the tertiary level. Insufficient attention is given to preventive medicine, health promotion, and/or early detection and treatment or medical problems by a less costly community-based primary health care approach. Finally, lack of, and/or outdated, materials and information is perpetuated by a lingering system of medical education and postgraduate medical studies based on out-dated didactics and not on more recent evidence-based medicine.
The situation has been complicated by Article 49 of the Ukrainian Constitution, which states that all Ukrainian citizens will have access to free health care. The Ministry of Health, with the support of the Council of Ministers, has attemped to select about 50 procedures for which hospitals could charge fees. In support of this, a decree was issued by the Council; the Ukrainian Constitutional Court ruled, however, that this decree was unconstitutional. It should be noted that the issue of «free» health care is an illusion. Recent figures from the Ministry of Health show that individuals pay about 50% of their health care costs.
Further efforts are critically needed to: establish expanded, broad-based primary health care services; increase access to wellness and first echelon treatment; develop or revise existing policies that will be more responsive to the health needs of the country; provide specialized training in specific fields; and reform the entire health care system. This would include developing a financial basis for asset pooling, for viability, for sustainability; and for the development of the necessary expertise and leadership for a sound, well-focused management structure. One specific area for the development of primary health care is reproductive health services for women.
The issue of incorporating and empowering ancillary health care workers to increase efficiencies requires a proactive training program for non-physicians such as nurses, midwives and medical technicians. It will require substantially more attention than it has been given in the past, including a change in the mindsets of those in power who have relegated these co-workers to more menial roles. Efforts will be undertaken to raise the competency levels of all health care providers, not just physicians. This will be achieved through developing the health care team concept. Ukrainian standards of care often lag far behind those of western levels, partially due to the lack of clinical training. Health care planning is needed to rationalize the health care system and adequately meet the needs of Ukraine's population. In this instance we look to the role of privatization.
Although a small private health care market has begun to develop in Ukraine, there is full consensus among international health experts familiar with Ukraine that, at least over the next five to ten years, a national health care system is necessary to provide the vast majority of health services required. The existing private sector has less than one percent of Ukrainian physicians participating. Among the many challenges is overcoming the reluctance on the part of State-employed physicians to lose such entitlements as apartments, children’s day care, and pensions. In addition, there are legislative impediments against establishing private practices.
In the specific area of health legislation, there is serious concern on the need for capacity building at the Ministry of Health on health care legislation. In 1992, the Government of Ukraine passed a primary health legislation bill, "Basics of the Legislation of Ukraine on Health Care". This was to serve as a basic matrix for additional supporting health legislation that would address in more specific detail a multitude of health care issues. This basic matrix for health care would then lead to the development for a number of specific laws that would be sent to the Parliament. In the ensuing years there were no more significant pieces of legislation that were presented to or passed by the Parliament.
Of paramount importance has been the need for drafting legislation for "operational" needs, such as the provision of health care; the development of laws for social and health insurance; laws concerning the use of blood products, etc. There have been, however, a constant number of decrees passed by various governmental entities: Presidential Decrees, Council of Minister’s Decrees, and Ministry of Health Decrees. In other instances there have only been "instructions" from the Ministry of Health. In this turbulent atmosphere, with a number of governmental bodies working on similar selected topics, confusion has been created through a number of contradictory instructions. Programmatically, we anticipate offering technical assistance in drafting legislation related to restructuring, capacity building, health care financing, and privatization to improve the capacity of the Ministry of Health.
Through implementation of this strategy, USAID is promoting a fundamental shift in Ukraine's paradigm for its health delivery systems: one that shifts from an inordinate reliance on tertiary programs, towards one with a greater emphasis on cost-effective and cost-benefit approaches referred to as "primary care." Primary care emphasizes wellness, prevention and first echelon care, improving health and reducing the necessity for the more expensive specialized health care at tertiary care facilities. The latter requires more costly professionals, more expensive equipment and procedures, and more lengthy hospital stays. This primary care approach is the overarching theme of each of the following elements identified by the strategy as crucial for health system reform in Ukraine:
- Health Care Delivery
- Promotion of Healthy Lifestyles
- Professional Education and Training
- Reducing Environmental/Occupational Risk to the Public Health
- Reproductive Health
- Financing
- Legal/Policy Environment
There is a growing sentiment among economists that health can be a driving force for economic revitialization – a somewhat different view from the more traditional one that says that first you have a strong economy and that this economy can then support a more robust health care system. A healthy workforce is a key economic indicator, one that leads to increased productivity with less inefficiencies such as lost production time and less consumption of health care resources.
Key Results: USAID will consider this objective achieved when the following conditions are met. (1) There is increased efficiency in public sector delivery of health care services through greater utilization of primary health care services. (2) The general health status of the Ukrainian people has stabilized, with increasing signs of greater longevity. (3) The infrastructure and capacity for a viable, sustainable health care financing mechanism has been implemented. (4) The ability to draft coherent health legislation and policies is present and effectively lobbied for passage by the Parliament. (5) NGOs and other private organizations are successful advocates in a civil society. (6) Privatization of service delivery is occurring.
Performance and Prospects: Despite a number of formidable obstacles, Ukraine, with the proposed help of foreign donors and international financial institutions, is prepared to address the areas and agenda of reform. There has been a start with the administrative reform at the Ministry of Health, as well as health care reform. Working closely with Government of Ukraine counterparts at the Ministry of Health and in the Oblasts, USAID has helped to design and implement a number of health sector reform programs and has been a catalyst in influencing the Government to support more aggressive health sector restructuring.
USAID’s health sector reform strategy will build on some of these earlier achievements to create a more efficient and effective health delivery services system. Increasingly, we anticipate building on a proactive NGO network for advocacy to allow enlightened citizens more active participation in the decision-making process concerning their health, their health care system, and its responsiveness. Throughout these initiatives there would be ongoing networking and soliciting of other health donor organizations.
Possible Adjustments to Plans: These programs have recently undergone strategic review, and no adjustments are contemplated for the present.
Other Donor Programs: Other donors have also recognized the importance of health sector reform in Ukraine. The World Bank has assisted in some moderate ministerial restructuring and has conditionally proposed a $120 milion loan to address tuberculosis and HIV/AIDS. Inherent in this is the strengthening of the public health infrastructure. USAID and the European Union have planned to implement a joint HIV/AIDS prevention program. Informal discussions have been held with the Soros Foundation concerning efforts at revitalizing the School of Health Care Management in Kiev. The Soros Foundation has also considered linking its Ukraine health care reform activities with those in Budapest.
Principal Contractors, Grantees or Agencies: U.S. Department of Health and Human Services, American International Health Alliance, Counterpart, JHPIEGO (a Johns Hopkins program that provides reproductive health information and education), and Johns Hopkins University/Population Communication Services.
Selected Performance Measures:
Baseline
Actual
(1998)Target
(1999)Target
(2000)Target
(2001)Percent of clinics focused on primary health/family medicine
0 (1998) 0 6 12 24 Percent of cancer screening programs that operate on a regular basis
1 (1998)
1
6
12
18
EXPLANATION FOR SPECIAL INITIATIVES and CROSS-CUTTING PROGRAMS
Title: Special Initiatives, 121-041
Planned FY 2000 Obligation and Funding Source: $90,000,000 FSA
Proposed FY 2001 Obligation and Funding Source: $93,300,000 FSASummary: This objective includes all of the 632 allocations and transfers to other USG entities. The majority of funding in this objective goes to the State Department for public diplomacy, humanitarian transport, international narcotics and law enforcement programs. Other recipients include the Departments of Commerce, Treasury and Justice, and the Environmental Protection Agency.
Title: Cross-cutting Programs, 121-042
Planned FY 2000 Obligation and Funding Source: $8,841,000 FSA
Proposed FY 2001 Obligation and Funding Source: $12,100,000 FSASummary: This objective is designed to accommodate activities that make significant contributions to more than one objective. The activities included in this objective for Ukraine are the exchanges and training program, the Eurasia Foundation, and program development and support activities.
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Last Updated on: February 01, 2001 |
