Kyiv. July, 16. Being one of the poorest regions in Ukraine, due to a number of strengths, however, Zakarpattya was ranked 3rd (behind Kyiv City and Dnipropetrovsk Oblast) in the competitiveness ranking of the 12 regions and 57th in the global index, behind the Republic of Cyprus and Kazakhstan and ahead of Turkey and Russia.
The project on studying Ukraine's competitiveness on the national and regional levels has been implemented by the Foundation for Effective Governance (FEG) in tandem with the World Economic Forum (WEF). The result was the Ukraine’s Competitiveness Report. WEF has been analyzing Ukraine’s competitiveness in its annual global competitiveness indexes since 1997. This year, the Foundation provided support, and along with the competitiveness ranking among 131 countries Ukraine received ranking of 12 selected regions: Dnipropetrovsk, Zakarpattya, Lviv, Sumy, Khmelnitsky, Donetsk, Poltava, Vinnytsya, Kherson, Cherkasy, Kyiv City and Crimea. The selected regions are from different geographic locations and have different structure of regional economies and cultural backgrounds.
This is the first comprehensive study of the 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.
Being one of the poorest regions in Ukraine, over the last 10 years, however, Zakarpattya has demonstrated an intensive economic growth. Despite a low level of profit per capita the Oblast occupies the high 3rd position in the global competitiveness index due to a number of its strengths.
Transparent and well-functioning public institutions make a key strength of the Oblast. Institutional indicators are above the national average – 76th compared to 108th in the global index.
The factors of authorities’ efficiency such as transparency of policy, administrative pressure and expenditures from the state budget received better scores if compared to the national average; the same situation is with the general crime rank. Zakarpattya continues to lead by the security pillar.
Indicators of macroeconomic stability, healthcare and primary education in Zakarpattya are slightly above the national average.
Zakarpattya also has a good score for goods market efficiency. It is the best among 12 regions of Ukraine and was ranked 45th out of 131 countries compared to 88th position of Ukraine in the global index. Goods market is more efficient than in Hungary. Zakarpattya is close to some developed countries by several indicators. For instance, Zakarpattya was ranked 15th, behind France, by the level of internal competitiveness. In terms of financial and labor markets efficiency, the Oblast was ranked 51st and 45th accordingly (Ukraine occupies 68th and 63rd positions). A high score for labor market demonstrates positive tendencies in reduction of unemployment in the region. Unemployment reduction rank is above the national average.
Technological readiness of Zakarpattya is close to the national average, while business sophistication and capacity for innovations are a little bit above the national average.
The worst weakness of the Oblast is underdeveloped infrastructure, at the same time, Zakarpattya plays an important role as a transit region for goods transferred from European countries to Ukraine and the Caucasus. The roads quality is very poor as everywhere in Ukraine. In terms of this indicator, Zakarpattya is on the same level as the Democratic Republic of Timor having one of the worst scores in the global index. Availability of telephone lines is low in Zakarpattya if compared to other regions of Ukraine.
According to the Report Ukraine was ranked 73rd out of 131 countries in the Global Competitiveness Index. The country is on a transition stage of economic development between the stage where economic growth depends on primary factors (non-qualified work force and natural resources) and the stage where economic growth increases by higher productivity (goods market development and technological innovations capacity).