Ukraine loses one percent of gross domestic product as a result of corruption in state enterprises, according to the country’s economy ministry. There is “tremendous corruption” among the 3,733 companies in the state’s enterprise sector, where resistance to change is “enormous,” Deputy Minister of Economy, Trade and Agriculture, Pavlo Kuchta said in a statement.
The National Anti-Corruption Bureau (NABU) estimated the state’s losses from corruption at 18 billion hryvnia, which amounts to 0.5 percent of Ukraine’s GDP. The minister added that “losses on unpaid procedures will be at least the same amount, that is, we lose one percent of GDP due to corruption in public companies.”
The impact of fraud on Ukrainian businesses was revealed in a poll in 2018 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.
In recent years, Kyiv has developed new anti-corruption structures such as a specialised investigative agency (NABU) and prosecution service (SAPU) and the election of Volodymyr Zelensky as president of Ukraine in May brought with it fresh hopes that crack down on the corruption will continue.
In September Zelensky’s government won plaudits for establishing a long-awaited Supreme Anti-Corruption Court, finally fulfilling one of the main demands of the IMF and other Western donors.
