Free of Charge, But Not for Nothing. What’s Wrong with International Aid to Ukraine
The international assistance to Ukraine is booming. According to the Ministry of Economic Development and Trade, during the last two years the amount of grants and technical assistance reached almost $1 bn. This is 1.5 times less than what Ukraine had received in 2008-2013. Moreover, since Maidan, international financial organizations have provided $3.5 bn of loans at a tiny interest rate to Ukraine. Is Ukraine using these huge resources effectively? "(Your) country does not need to ask for extra money, as what had been provided before, has not been used," - said recently the head of the EU Delegation to Ukraine Jan Tombinski. What prevents Ukraine from successfully cooperating with foreign donors? A boom amidst the chaos Olena Tregub, the director of the Department for International Programs Coordination at the Ministry of Economic Development and Trade, has been very busy recently. The Ministry has registered 133 donor projects amounting to $920 million in the last two years (data provided by the Ministry, calculations by VoxUkraine). The non-repayable aid comes in the form of money grants or assistance by experts and consultants. Only 2007 was more fruitful, mainly due to securing $1.1 bn for the "Chernobyl New Safe Confinement" project. 302 projects of international assistance are being implemented in Ukraine. Their total budget is equal to $3.7 bn. The launch of some projects dates back to the early 1990s (see Picture 1 for a breakdown by years). Is $1 bn in two years enough or too little? According to the OECD, Ukraine ranked 45th among the top-50 recipients of international assistance (see the OECD “Development aid at a glance statistics by region, Developing countries” report, page 15). In 2014, Afghanistan, Vietnam and Syria were the top-3 recipients of international assistance. Together, they received more than $13 bn. However, Ukraine ranks second among the developing countries in Europe, beaten only by Turkey. Ukraine received $1.4 bn in 2014, which accounts for 16% of all the assistance the region received that year (see the OECD “Development aid at a glance statistics by region, Developing countries” report, page 2). This is twice as much as what the country received in 2013.