Mr President, Mr Governor, Dear Colleagues,
Firstly, let me thank you for the opportunity to speak at such a high-profile professional forum.

It is true that the Foundation for Effective Governance took part in development of the law on public-private partnership following the invitation and in close cooperation with the Verkhovna Rada Committee for Industrial and Regulatory Policy and Entrepreneurship.

The Law on Public and Private Partnership was approved by the parliament and signed by the President in July 2010 as a part of Economic Reforms Agenda for the country.

Being market-oriented, the law shows the investors the government’s commitment to work in partnership with private businesses to realize long-term infrastructure projects. It distinguishes risks and responsibilities between the governmental and private partners and balances the interests of the state and the private investor.

Most importantly, the law contributes to improving the infrastructure in the country where the governmental resources are limited.

With the law coming into force, Ukraine received a practical instrument to develop its economy and improve national competitiveness. Just as you said, Mr Blizhnyuk, our common goal is to learn how to use this instrument properly.

While many nations similar to Ukraine only start to engage private capital in big infrastructure projects, some countries have gained solid expertise in applying this mechanism. We must learn from the mistakes of others and avoid them along with taking the utmost advantage of the practices of different countries. We have good examples to follow. In the United Kingdom, for example, over 75% of all implemented projects (and this is more than $110 billion) in the area of public-private partnership have been focused on hospitals, schools, housing and utilities; in Australia and Ireland - on roads; in Holland - on social housing. The list can go on and on.

You can learn, however, only from practice. So, making a correct choice and implementing pilot projects are a key to success on this path.

I will give you a couple of examples, which became clear during our regional development projects, which we implement in partnership with the local governments of Donetsk region and city of Lviv. We saw opportunities for two pilot projects here:

• The analysis of agricultural cluster in Donetsk region shows the need to build grain elevators and irrigation systems as well as develop infrastructure in villages.
Finding the complete solution to the problem of skilled workers is important, and establishing an agricultural vocational school will be of much help.

• The clusters of tourism and business services in Lviv urge to build new roads and develop telecommunications and office infrastructure.

Why do we believe that pilot projects of public-private partnership are so important?

Whereas PPP is used effectively across the globe as an economic development tool, every country adapts it to the local needs, which requires a focused action and time. In our view, it is vital for different players in this process to learn how to cooperate effectively, share and jointly manage risks, plan timeframes of agreements, meet their obligations on time, accurately forecast revenue and expenditure, etc. Establishing a feedback mechanism for the local government, regulatory institutions and businesses is crucial.

This feedback mechanism can be developed only in course of pilot projects of public-private partnership.

I would underline that the key word here is partnership, which must be responsible and reliable. If we achieve this, Ukraine and every citizen will benefit in the long run, because we will have then good roads, airports, schools, hospitals, regular water supply and stable heating in houses.
Thank you for attention.