The International Monetary Fund (IMF) has urged Ukraine to produce evidence that its fight against institutionalised corruption is making progress.
The lender said the conflict-embattled country must “show concrete results that signal a distinct and irreversible break with the… past” if it wants to continue receiving money from a $17.5 billion (€15.68 billion) bailout loan.
“Tackling corruption and reducing the influence of vested interests on policy making remain key challenges,” the IMF said in a report this week. “Progress in tackling corruption, privatising state-owned enterprises and advancing pension reform has been slower than envisaged against significant political resistance.”
The IMF spoke out after Ukraine received an additional $1 billion from its bailout fund in September, noting that corruption is deeply entrenched across the eastern European nation, and will require a “deep commitment” from those in power to eradicate.
Ukraine is the most corrupt country in Europe, according to Transparency International, sitting at the bottom of the organisation’s Corruption Perception Index among nations including Nicaragua, Nigeria and Papua New Guinea. Measured by the same yardstick, Ukraine is more corrupt than Russia.
Corruption has flourished in Ukraine since it declared independence in 1991, and is rife in nearly all sections of society – including politics, the judicial system, business and the public sector. The gravity of the problem prompted then-US ambassador to Ukraine Geoffrey Pyatt to warn corruption is more of a threat to the nation than the Russian-sponsored insurgency in the east of the country.
Some Ukrainian politicians have suggested a lack of political will at the top of government is holding back efforts to stamp out wrongdoing in the country, while western diplomats despair that the problem remains largely unchanged more than two years after the overthrow of President Viktor Yanukovych.
Current Ukrainian President Petro Poroshenko has declared the IMF’s decision to release the latest instalment of the country’s bailout loan last month a signal that “the world recognises that reforms are happening in Ukraine…, and that the country is moving in the right direction”. The IMF’s decision to announce that the nation has failed to demonstrate it is meeting the conditions of its bailout directly contradict this.
Just days after Ukraine learned that it would receive the latest instalment of its emergency loan, the EU launched a €16 million programme intended to help tackle corruption in the country. Led by Denmark, the initiative seeks to combat corruption by strengthening state institutions and civil society organisations. Denmark is the least corrupt country in the world, according to Transparency International.
“Corruption is a substantial challenge in Ukraine – in the daily lives of both businesses and citizens,” Danish Foreign Minister Kristian Jensen said ahead of the official unveiling of the scheme. “Corruption damages the growth potential in Ukraine and creates distrust among politicians and institutions.”