• In English
  • Speech by Commissioner Johannes Hahn at Investors' business forum, Lviv, Ukraine
    опубліковано 19 листопада 2015 року о 18:36

    Ladies and gentlemen,


    I'm delighted to have the opportunity to speak to you today about what needs to be done to give renewed confidence to the business community in Ukraine and also, what we in the EU are doing to improve the business climate in your country.


    In 2015, Ukraine has worked hard to ensure macro-financial stability. Following a deep recession, macroeconomic stabilisation is gradually taking hold. It is still too early to relax, but the outlook is better than before.


    In 1991, Ukraine and Poland had a similar GDP per head. Now Polish GDP per head is three times higher than in Ukraine.  Change in Poland required political will and tough choices, and cooperation between political parties, Government and opposition. It required technical capacity and teams in place, able to work over sustained periods on seeing work through. It required wide support throughout society.


    Ukraine can do the same.

    BUT the only way to unlock this country's potential is through reform: Reform to create confidence in rule of law; reform to create a business climate in which enterprise can flourish; reform to put in place a public administration that really works.


    We recognize the efforts made by the government. A great deal has been achieved in a short time. There is still a long way to go, but success is possible.


    Despite the massive pressure on the economy and the fragile situation in the east, I see no reason why this country cannot sweep away the other disincentives to do business in and with Ukraine. 


    That is why we're backing Ukraine with an unprecedented range of support. Last year we and the European financial institutions committed 11 billion Euro to support Ukraine’s political, economic and financial stabilisation and since then another 1.8 billion has been added.


    Today, I want to focus on the business climate  – how can Ukraine become attractive to investors, and how will the EU help?


    What Ukraine needs to do

    The EU is ready to help with promotion of investment in Ukraine. But we can only complement your own efforts to establish a solid reputation for Ukraine as a good destination for investments. That is perhaps one of your biggest challenges. 


    Next year, the government hopes to move on from  securing macrofinancial stability to achieving economic growth, by launching a number of reforms. This is good news. We encourage the government to make full use of the expertise available in the EU Delegation in Kyiv, the IMF Office and World Bank so that these reforms can be carried out in line with best practice and commitments undertaken.


    There are two issues, that will determine whether today's Ukraine can make a breakthrough.  Tackling corruption and judicial reform. These are "make or break" issues without which nothing else can succeed. Legislation is worthless if it is not upheld by the courts. No amount of deregulation will compensate for corrupt practices among officials.


    We support reforms in these key areas by attaching conditions to the disbursement of funds that we supply in grants and loans.   But in the end, change has to be planned and carried out by the Ukrainian government.


    And the change has to go deep. Anti-corruption efforts and judicial reforms are not concessions to the EU. They are crucial to the interests of the Ukrainian people, and the business community working here.  This change has to be made and owned by Ukraine. 


    Customs is an area in which anti-corruption is important and which is of utmost importance to a successful development of business activities in Urkaine. Much too often, Ukrainian customs in the past has been associated with artificial queues at the border and the need to pay so-called "acceleration fees" to clear goods through customs.  To obtain a modern and efficient economy, Ukraine also needs a modern and efficient customs service that is dedicated to high standards of law enforcement and ethics and facilitates legitimate business. 


    AND alongside these efforts, Ukraine must also  deliver proper implementation of reforms in key areas for the DCFTA like Technical Barriers to Trade, Sanitary and Phytosanitary standards, and Public Procurement). These are measures that can quickly  deliver tangible short term economic benefits for Ukraine. 


    What the EU is doing

    Having said this, the European Union can help. We have put in place a number of measures to support business.


    The Deep and Comprehensive Free Trade Area which will enter into force on 1 January will not change your economy overnight – but over time it will help you find new markets and new opportunities for business in Europe and beyond.


    It will contribute to a better business climate, because it offers predictability. Investors will know what regulatory environment will be in force in Ukraine.

    The keyword again is ownership. The Ukrainian government needs to implement the agreement, of course, and we are jointly reaching out to companies to explain what the changes mean, so that the business community can play its part.


    We have launched a facility to help SMEs in particular  to take advantage of the new opportunities for trade with the EU. We will improve access to finance to help SMEs and we will also help them to comply with new technical and environmental rules.  We expect the facility to  unlock around a billion Euros of new investments in Ukraine.


    "EU for Business" is intended to help change the business environment, by working with regulators to reduce burdens on business.  And to provide advice and help Ukrainian producers find markets in the EU.


    Now – I have heard Lviv being called the most European city in Ukraine. You are just 60 km from the border and are already a magnet for tourists.  You have three quarters of a million citizens with a high skills base.


    I want to come back and visit Lviv towards the end of my mandate as Commissioner and see Lviv not just one of the most innovative cities in Ukraine, but taking its place among the success stories of Europe.


    I hope you will invite me back to see this: I am sure you can make it happen!


    Thank you.


    European Commission