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Public and private institutions in Khmelnitsky Oblast are more efficient if compared to those in other regions of Ukraine
Kyiv. July, 14. Khmelnitsky Oblast was ranked the 5th among 12 regions of Ukraine (behind Kyiv City, Dnipropetrovsk, Zakarpattya and Lviv Oblasts); it was ranked the 69th in the global index behind Costa-Rica and ahead of Brazil.
The project on Ukraine’s competitiveness on the national and regional level has been implemented by the Foundation for Effective Governance (FEG) in cooperation with the World Economic Forum (WEF). The result of the project was Ukraine’s Competitiveness Report. Since 1997, WEF has been analyzing Ukraine’s competitiveness within the framework of its annual reports on global competitiveness. This year, with the Foundation’s support, along with the global ranking among 131 countries Ukraine received competitiveness ranking of 12 selected regions: Dnipropetrovsk, Zakarpattya, Lviv, Sumy, Khmelnitsky, Donetsk, Poltava, Vinnytsya, Kherson, Cherkasy, Kyiv City and Crimea. The selected oblasts have different geographic locations, different structures of regional economies and cultural backgrounds.
This is the first comprehensive study of 12 Ukrainian regions that helps see the core of strengths and weaknesses in competitiveness of each region. “This approach can help to develop regional policies, determine priority areas for regional development and understand what the region can do today to improve people’s lives”, - Director of the Foundation for Effective Governance Nataliya Izosimova said.
Along with statistics, 50 business leaders were surveyed in each region. In general, questions were the same as asked on the national level, in particular, health and primary education, goods market efficiency, labour market efficiency, financial market sophistication, technological readiness and business sophistication, etc.
In general, the level of competitiveness of Khmelnitsky Oblast is average in Ukraine. Key strengths of the Oblast are public and private institutions efficiency and labor market efficiency. Khmelnitsky Oblast is far ahead of other oblasts of Ukraine by this indicator. Business leaders think that local businessmen are more reliable than Ukraine’s average and local authorities are less corrupt than national.
Khmelnitsky Oblast’s level by indicators of macroeconomic stability, healthcare, primary and higher education are similar to the national average. At the same time, Khmelnitsky Oblast received a low score for quality of education and it was ranked the 75th in the global index (on the level of Salvador).
Low dynamics of new firms’ entry into the market is a major obstacle for business development which is below the national average level. Also, Khmelnitsky Oblast is primarily an agricultural area, which is less interesting for foreign investors.
The Oblast was ranked the 66th in the global index in terms of access to loans and the 127th in terms of reliability of the banks.
The Report has demonstrated that the level of use of new technologies is even lower; it was ranked the 93rd in the global index. Still, this indicator is above average in Ukraine. New technologies in the Oblast are less available. The number of personal computers in the Oblast is 2.6 per 1,000 inhabitants compared to 3.8 in the country (the national average indicator). Agricultural structure of the regional economy and low level of direct foreign investments also contribute to lower level of use of new technologies (the 111th in the global index).
The level of business sophistication and innovations is low in the Oblast. In terms of innovations the Oblast was ranked the 88th in the global index (between Mali and Macedonia; Ukraine was ranked the 77th). As a result quality of research institutions in also low. Khmelnitsky Oblast experiences lack of professional researchers and engineers if compared to other Oblasts.
The most problematic factors for business development are burdensome tax system, political instability, corruption and bad access to loans.
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