Ukraine signs OECD agreement to strengthen investment climate
27/03/2017 - Ukraine has become the 47th country to adhere to the OECD Declaration on International Investment and Multinational Enterprises. The Declaration commits Ukraine to provide an open and transparent environment for international investment and to encourage the positive contribution foreign investment can make to economic and social progress.
The recently published OECD Investment Policy Review of the Ukraine confirms that Ukraine has made significant progress in recent years in improving its investment policy framework. The country has also undertaken important policy reforms in many of the areas covered by the OECD Guidelines for Multinational Enterprises. The current government’s efforts to align with international standards and good practice have enjoyed wide support among business and trade union representatives. Continuous efforts have also been made to simplify establishment and licensing procedures. Ukraine also introduced significant tax reforms in 2015, resulting in better tax transparency. A Business Ombudsman institution has been established to tackle concrete problems faced by new and established foreign investors.
However, the review also highlights how much is still to be done. Bribery remains one of the main risks for businesses operating in Ukraine and the government should pursue its efforts to fight corruption in the public sector and promote the establishment of corporate policies and other preventive mechanisms. The government is required to set up a National Contact Point for the OECD Guidelines for Multinational Enterprises within the Ministry of Economic Development and Trade. The National Contact Point will further the effectiveness of the Guidelines by undertaking promotional activities, handling enquiries, and contributing to the resolution of issues that may arise from the alleged non-observance of the Guidelines in specific instances.
As an adherent to the Declaration, Ukraine will fully participate in the work of the OECD Investment Committee, a leading forum for international co-operation on international investment issues. The Investment Committee offers an opportunity for Ukraine to engage in active policy dialogue with peers and to benefit from international good practices and expertise. Participation in the OECD Investment Committee will help Ukraine to build the capacity to meet its commitments and obligations under the Declaration.
The review and adherence to the Declaration were conducted within the framework of a 2014 Memorandum of Understanding to strengthen co-operation between Ukraine and the OECD. An Action Plan for the implementation of the MoU signed in 2015 identified investment and improving the business climate as one of the priority areas for OECD intervention. This work has been co-financed by the European Union, Sweden and the United States.