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#Ukrainian corruption in infrastructure? What results for #EU money?

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The European Union provides Ukraine with financial resources for reform and economic development. Ukraine is located at the crossroads of many transit corridors that connect Europe with other countries. The development of transit corridors for different means of transport is an important task for Ukrainian officials. The EU and its financial institutions generally provide Ukraine around 6 billion EUR in various programs for the development of infrastructure s projects.

 

EU assistance

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Originally, some of these funds have not been used in Ukraine due to the fact that the EU wants to make sure that these funds will be used transparently, without the corruption component https://mtu.gov.ua/news/31407.html  .

In order to establish effective use of the funds provided, the Ukrainian government has developed a Comprehensive Plan of Action for the Implementation of the Lifecycle Management Strategy for Infrastructure Projects in Ukraine for 2020-2024 http://surl.li/apkg .

In December 2017, the European Union approved a new Strategic Assistance to Ukraine program for 2018-2020 ( Single Support Framework ), which was developed with regard to 3 key goals of Ukraine's support: strengthening public administration, strengthening the economy and strengthening society. The European Community supports Ukraine in its pursuit of reform and finances these projects.

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The total amount of EU assistance to Ukraine during this period should be 430-530 million EUR. Funding will be provided on a “ more for more ” principle , ie there is a direct dependence on funding from the implementation of projects and implementation of the reforms agreed upon the program.

It is important for European investors to understand who and how the international assistance funds will be used for the purpose of the transport industry and transit corridors development.

Strategy of the reforms by the "new faces "

The operation of transit highways and the creation of hubs in Ukraine is provided by the Ministry of Infrastructure of Ukraine http://mtu.gov.ua/en/ .This department is responsible for road, air, rail, sea and river routes.

It happens often so, that some good ideas are  used to cover formal use of resources or arbitrary decision implementation. Infrastructure Minister Vladislav Krykliy adheres the principle of staff  selection and appointment, based on the main criteria for him -  "new faces” . Between professionals and new people with an unknown level of expertise and training, preference is given to new people, and the level of their professionalism often does not match the level of positions and responsibilities hold by such appointees.

At the same time, the Minister of Infrastructure, who is the senior official in relation to many subordinated state-owned enterprises and subdivisions, is implementing a personnel policy that impedes the achievement of the European integration goals. About 60 heads of enterprises, subordinated to the Ministry, are in the status of acting, some structural units have no management at all.

Case of  " Delphi " tanker is indicative. This ship, under the flag of Moldova , lost the anchor in late November 2019. As a result, the tanker reached a shore near the city beach "Dolphin" in Odessa, which resulted in an spill of petroleum products and other harmful substances in the suburban water areas. Now the ship has already become a local attraction - against its background, people make pictures and selfies. It is not known, how the Ministry of Infrastructure plans to solve this problem.

Industry experts emphasize that ministry and many heads of its units do not have sufficient experience, but bear considerable responsibility for the development of Ukraine's transport infrastructure.

An example of successful business

In the transport sector Ukraine there are enterprises, which work on developing expansion of economic potential, such as state enterprise " Derzhhidrographia " ensure the provision of hydrographic and navigation services for safety of navigation in the sea area and inland waterways of Ukraine. The company maintains lighthouses and buoys, as well as other technical means which help to navigate the route for sea and river vessels.

In recent years, the team has modernized the electronic navigation system, using drones to digitize navigation maps. An important area of activity is the ordering of the navigation system and the safety of navigation on inland waterways. The company implements innovative solutions, which are being developed jointly with the National Academy of Sciences of Ukraine in order to increase the level of security and to increase the transit potential of the Ukrainian economy.

" Derzhhidrographia”  consistently protects national interests: it continues work to counteract aggression and security of sea navigation; at the request of the institution, the regional electronic map centers of the International Hydrographic Organization PRIMAR (Norway) and IC-ENC (United Kingdom) excluded Russian electronic navigational maps (ENC) of Ukrainian waters from its catalogs https://hydro.gov.ua/?p=1919 .

The institution is headed by an experienced professional Oleksandr Shchyptsov https://hydro.gov.ua/?page_id=2026  , who managed the reorganization of the enterprise, whereby funds are invested in human capital development, staff trainings are carried out, equipment and vessels are updated.

The director of the Institute for Energy Research, analyst and political expert Dmitry Marunich in Facebook publicly emphasizes http://surl.li/apkx  that this enterprise has been able to implement a number of innovative projects that meet the best world models.

Despite this, the company and its management's were attacked by means of information campaign aimed at changing the company’s management. Former head of the institution Dmytro Padakin and Head of Maritime Transport Workers Unions of Ukraine Mykhailo Kireyev systematically fed false information to the Minister of Infrastructure , discredit the leadership of “Derzhhidrographia” and actual achievements of the enterprise. It seems that a group of individuals is interested in changing the leadership of the enterprise in its favor and establishing control over the sphere of strategic importance for the economy and security of Ukraine.

One can only hope that the Ministry of Infrastructure will properly assess the situation and make decisions solely in the interests of Ukraine.

Real problems of the industry

The Ministry of Infrastructure should pay attention to the real problems that most experts are aware of. For example, focus on the fact that the Maritime Administration of Ukraine, which is in charge for the accreditation of sailor training schools, conducts this accreditation by unclear criteria. Corruption is widespread in this area. One needs to pay shadow money to get a profile education, qualification certification, permits and admissions.

Experts and bloggers write about it , such as Ivan Niyaky http://surl.li/apip , who gives details about corruption manifestations in the certification of Ukrainian sailors .

Specialists who seek to obtain a sailor’s passport, certifying qualifications, encounter several corrupt circles. All those involved in the industry are aware of these phenomena, but it seems that the Ministry and infrastructure is not aware of this.

The Ministry declares a high level of transparency in its operations, but no comments for searches that were held in the office of the state secretary of the Ministry Andriy Halaschuk by the State Bureau of Investigation and the National Police http://surl.li/apne .

The European Union has previously supported the establishment of state secretaries positions in the ministries in Ukraine. The idea was that these officials should not be involved in the policy and quota principle of forming a government. But as it turned out, apolitical state secretaries may not always be anti-corruption ones.

Thus, we can conclude , that the introduction of new technologies in the transport sector of Ukraine depends on the trust of the European institutions in Ukraine. The financial resources earmarked by European partners for reforms in Ukraine's transport industry should be used to drive innovation and modern approaches to creating trans-European transport corridors and hubs in Ukraine. To this end, the Ukrainian authorities must demonstrate real steps in the fight against corruption and follow the best examples of activities in Ukraine and abroad.

Corrupt practices: raider seizure of State Hydrography

Despite the real achievements of the State Hydrographic Institution, the Ministry of Infrastructure of Ukraine sent to the Cabinet of Ministers of Ukraine on February 18 a Submission for approval by the Acting Head of the State Institution, Dmitry Padakin.  This is exactly the former head of the State Hydrography, who was fired in March 2019 and is a figure in criminal cases.

Experts state that http://surl.li/apyl is actually taking place in advance prepared raid capture of "State Hydrography" by the Minister of Infrastructure Vladislav Krykliy, Secretary of State of this Ministry Andriy Galuschuk persons.  This hobby was planned and is going against the economic interests of Ukraine, directed against industry experts.  The sole motive for Dmitry Padakin's appointment is to achieve the vested interests of a group of interested persons who heads the Ministry of Infrastructure and, using their official position, appoints their protégés to management positions.

Political expert Petro Oleschuk http://surl.li/apyf assessing the situation states in a Facebook audience that Dmitry Padakin does not make the impression of a "Noah's face" because he was already acting as a State Hydrography and in relation to him the Unified Register of Pre-trial Investigations has repeatedly submitted information on various corruption offenses.

The expert also points out that the central authorities of Ukraine http://surl.li/apyj and in particular the Ministry of Infrastructure have recently been caught up in corruption news.

There is a blatant and unconcealed violation of the procedures for appointing executives, there are no qualification checks of the candidate and no open competition is announced.

Attention should be paid to the personnel policy pursued by the Ministry of Infrastructure of the National Security and Defence Council and the Security Service of Ukraine, as it is an institution that provides national interests in the field of hydrography and navigation.  It is obvious that the human resources situation in the Ministry of Infrastructure undermines the confidence of the Ukrainian society in the Cabinet of Ministers and its anti-corruption policy, which shames it in the eyes of the international community.

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Agriculture

Organic farming: local leaders call for a stronger role in the implementation and evaluation of the action plan

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Organic farming, through its positive environmental and climate impact in terms of improved carbon sequestration and soil health, biodiversity conservation and animal welfare, contributes to the objectives of the European Green Deal and targets of the EU Farm to Fork and Biodiversity strategies. The European Committee of the Regions (CoR) adopted on 2 December the opinion on EU action plan for organic farming.

The CoR welcomes the EU action plan for organic farming and endorses its comprehensive approach. The aim of the action plan is to increase the production and consumption of organic products, thereby reducing the use of fertilisers, pesticides and antimicrobials. Under three axes - increasing consumption, increasing production and further improving the sustainability of the sector - 23 actions are proposed.

The rapporteur on EU action plan for organic farmingUroš Brežan (SI/Greens), mayor of Tolmin, said: “Increasing support to organic farming is urgent, in order to ensure the achievement of the 25% target of agricultural land devoted to organics by 2030. We must ensure that the next Common Agricultural Policy will contribute to the European Green Deal and to the Farm to Fork and Biodiversity strategies' targets. Local and regional authorities have a key role in the creation and development of 'biodistricts' and structuring the organic sector. Thus, local and regional authorities should be closely associated in both the implementation and the evaluation of the action plan through a network at the regional level. We call the Commission to set up such a network.”

Local leaders emphasised their key role in raising awareness at local level, informing consumers about the positive impact of organic farming and developing educational programmes for nurseries and schools. The opinion points out that local and regional authorities have a key role also in structuring the organic sector in terms of production, logistics and trade, facilitating structured cooperation between producers and consumers.

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To stimulate the production side, all European and national policies must be mobilised to increase the consumption of organic products, stressed local leaders. In 2019, the EU had an organic land area of approximately 8%, while subsidies for organic farming represent only 1.5% of the total European agricultural budget. Organic farming is underfunded under the CAP, which is currently not fully consistent with the objectives of the Organic Farming Action Plan. Moreover, the opinion recommends the Commission to thoroughly evaluate the CAP national strategic plans submitted by the Member States in order to monitor that they will contribute to achieving the target of 25% of agricultural land devoted to organic farming by 2030.

The CoR welcomes the recognition of Bio districts as effective rural development tools. In the geographical area of a Bio district, farmers, the public, local public administrations, associations and commercial tourist and cultural enterprises enter into an agreement for the sustainable management of local resources based on principles and methods of organic production and consumption. Such regions in particular should therefore receive support and common services via a network to be set up by the European Commission.

Background information

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  • Organic action plan - by producing high quality food with low environmental impact, organic farming will play an essential role in developing a sustainable food system for the EU. A sustainable food system is at the heart of the European Green Deal. Under the Green Deal’s Farm to Fork strategy, the European Commission has set a target of ‘at least 25% of the EU’s agricultural land under organic farming and a significant increase in organic aquaculture by 2030’. To achieve this target and to help the organics sector reach its full potential, the Commission is putting forward an action plan for organic production in the EU.
  • CAP strategic plans: Issues and expectations for EU agriculture: The European Commission's legislative proposals for the reform of the common agricultural policy (CAP) were published in June 2018. Since then a number of significant developments have occurred in this policy area. These include the adoption of the European Green Deal and its associated initiatives of the 'farm to fork' strategy and the biodiversity strategy, and also the agreement on the 2021 2027 multiannual financial framework (MFF) alongside additional support of €7.5 billion for rural development from the Next Generation EU initiative as part of the recovery and resilience package.
  • Farming without plant protection products
  • The EU 'farm to fork' strategy: On 20 May 2020, the European Commission adopted a communication on 'A farm to fork strategy for a fair, healthy and environmentally friendly food system'.
  • IFOAM Organics Europe: IFOAM Organics Europe is the European umbrella organisation for organic food and farming. They represent organic in European policymaking and advocate for a transformation of food and farming. Their work is based on the principles of organic agriculture – health, ecology, fairness and care. With almost 200 members in 34 European countries, their work spans the entire organic food chain.

The plenary agenda

Webstreaming: On the website of the CoR.

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Eurobarometer

Eurobarometer: Survey shows strong support for euro, SURE and Recovery and Resilience Facility

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Public support for the euro is strong and stable, according to the European Commission's latest Eurobarometer survey. A majority of respondents (78%) across the eurozone believe the euro is good for the EU. Furthermore, 69% of them consider the euro positive for their own country. These results indicate the second highest support for the euro since the start of the annual surveys in 2002. This Eurobarometer survey was conducted among some 17,600 respondents from the 19 eurozone member states, between 25 October and 9 November 2021.

The results also show strong support for the European instrument for temporary support to mitigate unemployment risks in an emergency (SURE), with 82% of the respondents agreeing on the relevance of providing loans to help member states keep people in employment. Likewise, financial support provided by the Recovery and Resilience Facility (RRF) was positively perceived by 77% of the respondents. Finally, 65% of respondents were in favour of the abolition of one and two-cent coins through mandatory rounding of the final sum of purchases to the nearest five cents. The Eurobarometer survey is available here.

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Economy

Protecting the EU’s financial system from cyber attacks and ICT disruptions

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MEPs on the Economic Monetary Affairs Committee voted (1 December) for new rules aimed at  strengthening the resilience of ICT systems in the financial services sector, specifically the requirements to detect, contain, protect against and repair information and communication ICT problems. The new requirements would be accompanied with reporting and testing of digital capabilities.

“The European Union is one step closer to having a comprehensive and well-coordinated set of rules addressing ICT risk and building cyber resilience for all entities”, said Billy Kelleher (Renew, IE), responsible for the regulation.

The rules would apply to financial entities regulated at EU-level, such as banks, payment providers, electronic money providers, investment firms, crypto-asset service providers and ICT third-party service providers.

Risk preparedness and reporting

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The ICT risk management framework should take into account significant differences between financial entities in terms of size, nature, complexity and risk profile. MEPs want businesses to effectively respond and recover quickly while ensuring operational continuity.

In order to achieve a robust ICT-related-incident reporting regime for financial entities with less administrative burden and no reporting overlaps, MEPs agreed that they should report to their competent authorities in a centralised and harmonised manner. The possibility of establishing a single EU Hub for major ICT- related incidents should be explored.

Oversight of ICT third-party risk

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The oversight should extend to providers of  ICT services. MEPs recognised their crucial contribution to the functioning of the financial sector and have  therefore called for them to be properly overseen at  an EU-level by a Joint Oversight Body. The committee also want one of the European supervisory authorities  to directly oversee critical ICT third-party service providers. Additionally, critical ICT third-party service providers established in third countries would be required to be established in the EU in order to be able to enter into contractual arrangements with financial entities.

Finally, MEPs want to enhance the exchange of information and cooperation between the ESAs, national competent authorities, the Network and Information Systems Cooperation Group (NIS), national computer security incident response teams (CSIRTs) as well as the Lead Overseer and Joint Oversight Body. This is to ensure that the cyber security strategies adopted by member states are consistent, to make financial supervisors aware of cyber incidents and to enable a cross-sector learning process.

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