Kyiv, Ukraine, July 7, 2008—IFC,
a member of the World Bank Group, has published the results of a 2007 survey
of the technical regulations system in Ukraine and its impact on the country’s
economic development and consumer protection.
The survey found that the technical regulation system needs urgent reform.
IFC identified key issues constraining enterprise development and economic
competitiveness in Ukraine. These include mandatory compliance with state
standards—applicable de facto to all goods and many services—and the
mandatory certification of more than 400 types of goods and services, irrespective
of their actual risk level to consumers.
Other constraints include the high number of business inspections, particularly
at the production level, rather than at the marketplace where product safety
and compliance with standards are ensured.
The survey also found that majority of existing standards originated during
the Soviet era and are prescriptive, restrictive, and inconsistent with
European standards. Also, technical regulations functions concentrated
within one institution lead to conflicts of interest and prevent a focused
approach to the issues.
The survey concludes that Ukraine’s World Trade Organization integration
and the forthcoming negotiation of a free-trade agreement with the European
Union offer exceptionally positive conditions for achieving a breakthrough
Key recommendations include making most standards optional, keeping only
safety requirements as mandatory, reducing the scope of mandatory certification,
transitioning to a control system based on market checks and producer responsibility,
and introducing international standards through simplified adoption procedures.
The survey was conducted in 2007 by the
IFC Business Enabling Environment Project. The full document in both English
and Ukrainian can be downloaded from the Project’s Web site at www.ifc.org/Ukraine/BEE.
IFC, a member of the World Bank Group, fosters sustainable economic
growth in developing countries by financing private sector investment,
mobilizing private capital in local and international financial markets,
and providing advisory and risk mitigation services to businesses and governments.
IFC’s vision is that people should have the opportunity to escape poverty
and improve their lives. In FY07, IFC committed $8.2 billion and mobilized
an additional $3.9 billion through syndications and structured finance
for 299 investments in 69 developing countries. IFC also provided advisory
services in 97 countries. For more information, visit www.ifc.org.
The IFC Ukraine Business Enabling Environment
Project works to promote the development of small and medium enterprises
and to improve the country’s investment climate. Donors include the governments
of Canada, the Netherlands, and Sweden.
For more information about IFC’s partners,
The Canadian International Development
The Dutch Agency for International Business
and Cooperation, www.evd.nl
The Swedish International Development
Cooperation Agency, www.sida.org