The Institute for Economic Research and Policy Consulting - Kyiv

In compliance with the requirements of the International Monetary Fund, Ukraine has split its previously combined fiscal service into separate tax and customs agencies. This is a step in the right direction, which should be followed by re-orienting the customs to serve businesses and promote cross-border trade.

In September 2017, the Ukrainian Parliament adopted changes to the Law on Education that established Ukrainian language as the single language of school education. The Law aims to fight discrimination of national minorities in Ukraine creating the possibilities to study Ukrainian language at national minority schools.

Ukraine is seen as a country where political corruption have become a natural component of social relationships. A consensus has even emerged that it will be impossible for Ukraine to be successful without eradicating widespread corruption. Fighting corruption is a multi-dimensional process.

If Ukraine loses the chance to receive assistance from the IMF and other international donors in 2018, the government will be hard-pressed to execute planned fiscal expenditures in 2018. The fiscal indicators will be also revised for 2019 to lower real GDP growth and higher inflation.

The first steps of the long-awaited customs reform in Ukraine started in 2017 only to be cancelled at the beginning of 2018. Meanwhile, customs clearance in the country remains lengthy and complicated, which is reflected in Ukraine’s low positions in comparative international rankings.

Intellectual property (IP) protection and enforcement when done right are one of the fundamental conditions for innovation and competition. Ukraine’s strategic documents list protection of IP rights among policy priority. However, the implementation of IP-related reforms remains slow.

By April 1, state officials and certain other individuals were required to submit 2017 property and income e-declarations. While many people criticized the new requirement for the anti-corruption activists to submit e-declarations, members of supervisory boards at SOEs were also required to submit such declarations in 2018.

The end of February 2018 was marked by the victory celebration at the Ukrainian gas market as Ukrainian Naftogaz won the case on gas transit against the Russian Gazprom at the Stockholm Arbitrage Court. The Gazprom has to pay the Naftogaz USD 4.6 bn for violating the “take or pay” clause.

The year 2017 brought wins and failures. The Ukrainian Government was able to approve important reforms, which was still not sufficient to receive scheduled assistance from the IMF and the EU. 2018 will be tough as Ukraine should make large progress in many areas, while the 2019 elections are approaching.

On December 7, 2017, the Ukrainian Parliament had the day of Budget-2018. During one day, the Verkhovna Rada amended the Budget Code and Tax Code, as well as adopted the State Budget Law for 2018. The decisions were taken in a very non-transparent way with changes approved from the voice.