At its meeting on February 17, the Cabinet of Ministers of Ukraine approved the draft law On State Reserves. The document, if adopted by the Verkhovna Rada and entering into force, will become the basis for the development of a modern reserves system in Ukraine.

"The proposed draft law should become the basis for the creation of a actually new state reserves system. A modern one that meets the best Western standards and takes into account the challenges facing Ukraine. The key markers are relevance, flexibility, and control. We propose to establish new principles for the formation of the state reserve nomenclature based on modern approaches. The system should be made more flexible by distinguishing between the state material reserve and the mobilization reserve. And at the same time, through the introduction of a secure automated database, to make it more controllable," said Yuliia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine.

The draft law also provides for

• clear determination of balance holders of the state material and mobilization reserves;
• powers of the central executive body implementing the policy in the field to check the availability of material assets of the state reserves;
• the concept of reserves, the procedure and criteria for selecting reserves;
• the possibility of storing fuel in European countries.

The document improves and clearly sets out the procedure for refreshing material assets, and suggests ways to strengthen responsibility in the area of formation, storage, distribution, refreshment, etc. of reserves.

The draft law was developed pursuant to paragraph 1 of the action plan for the implementation of the Strategy for Reforming the State Material Reserve System until 2025, approved by the Cabinet of Ministers of Ukraine on November 25, 2022.

The Strategy for Reforming the State Material Reserve System recognizes a deep systemic crisis in the state reserve system. In particular, the problems that have been gradually emerging over the past 30 years include:

• lack of stocks of material assets of the state material reserve in the required volumes and inconsistency of the nomenclature of material assets of the state reserve with the strategic needs of the state;
• insufficient funding for the accumulation of stocks of material assets of the state reserve and the inability to replenish material assets in a timely manner;
• inefficient management of the state reserve stocks of material assets;
• the presence in the state reserve of stocks of material assets with expired shelf life;
• a complicated and time-consuming procedure for unbundling the state reserve inventory;
• inconsistency of the regulatory framework governing the functioning of the state reserve with current circumstances, etc.

The reform of the state reserve is aimed at solving these problems and creating a modern and efficient system of formation and storage of the state reserve.