Ukraine loses more than 4 billion euros annually to corruption at the countries borders, according to an investigative report by the German newspaper, Süddeutsche Zeitung.
“This is more than one-tenth of the entire revenue of the budget and twice as much as Ukraine wants in 2018 from the International Monetary Fund, the European Union and the World Bank,” said Süddeutsche Zeitung in the report published on Monday.
The newspaper analysed customs clearance documents and transport invoices to detect the level of fraud used to avoid paying duties at the country’s borders. One of the fraudulent measures employed by importers involves changing the labels on goods – for example, registering umbrellas as brushes or mirrors – resulting in the loss of thousands of euros to the state on each cargo.
According to the German daily, new companies are formed controlled with the help of customs officers, prosecutors and police officers for the purposes of carrying out the illegal transactions.
The growing impact of fraud on Ukrainian businesses was revealed this year in a poll conducted by PricewaterhouseCoopers (PwC) which found that in 73 percent of Ukrainian companies faced corruption and bribery – compared to 56 percent in 2016. By comparison, the global average is 25 percent.
One third of the companies surveyed in Ukraine said that they have received bribery offer in the last two years. In general, almost half of respondents believe that they have been subject to economic crimes – 5 percent more than two years ago. According to PwC, illegal seizure of assets (62% in 2016, 46% in 2018) and fraud in the procurement sector (25% and 33%) remain the most common examples of such crimes in Ukraine, along with corruption and bribes.