Ukraine: World Bank Supports E-Development

WASHINGTON, May 6, 2003-The World Bank today approved a US$5 million E-Development Project for Ukraine, which will assist the Government of Ukraine to enhance efficiency of the decision-making process, foster private sector development, and strengthen civil society in Ukraine by introducing innovative models of Information and Communication Technologies (ICT) solutions.

In Ukraine, the use of ICTs in everyday life, especially relating to the Internet, is still in an early stage of development. Currently, the ICT sector in Ukraine is characterized by a lack of an appropriate legal and regulatory framework, which validates online transactions; undeveloped infrastructure and logistical systems; comparatively expensive access to the Internet; and poor local content development.

“The project will promote a market-driven approach, which will foster development of the ICT industry, infrastructure building, access to online services and local content, and extend Internet penetration in Ukraine,” says Luca Barbone, World Bank Director for Ukraine, Belarus and Moldova.  “The implementation of the E-Government, E-Business and E-Dialogue models at national and regional levels will strongly demonstrate how innovative ICT solutions can contribute to sustainable, accelerated and broad-based economic growth.”

The project will provide a wider, deeper and longer-term perspective by assessing the overall impact of the E-Government, E-Business and E-Dialogue elements on the functioning and operation of the government and public. It also will facilitate private sector development by introducing more competition in the public procurement of goods and services, and by enabling on-line business transactions through the appropriate legislative framework.

"Although the project will focus on only a few critical areas of E-Development, its outcome lays far beyond the Project framework since it will create essential fundamentals to bridge the digital divide and advance Ukraine towards the knowledge-based economy,”   says  Andrei Mikhnev, Project Team Leader.

The E-Development Project has three main components. The first component,

E-Government, will introduce e-procurement and e-documentation flow models that aim to substantially improve efficiency in Ukraine’s public administration at central and regional levels. The E-Business Environment component will create a legal and regulatory framework, which will allow on-line transactions in Ukraine to be recognized as legally binding. This legal framework will be based on best practices and compatible with EU standards. The third component, Public-Private E-Dialogue, will develop on-line models and tools for enhancing public involvement in governance processes through active participation in the development of public policies and regulatory decision-making.

By supporting the Government's long-term public administration reform efforts, the project will benefit the entire population. A wider application of ICT will encourage a dialogue among policy makers and NGOs about best practices for incorporating the views, concerns and priorities of more vulnerable groups into Government projects and programs. It will also improve the legal environment in the e-business area, thus helping to form and enhance a wide range of development applications – from e-commerce and e-government to assisting small and medium entrepreneurs, and providing on-line tools to different communities to better access to knowledge and information.

The loan will be at the Bank's standard interest rate for LIBOR-based, single currency dollar loans, repayable in 20 years, including a 5-year grace period. Since Ukraine joined the World Bank in 1992, commitments to the country total more than US$3.4 billion for 26 operations.

For more information on the Bank’s work in Ukraine, visit www.worldbank.org.ua