Russkiivopros
No-2011/2
Author: Victoria Gumeniuk  & Liubov Akulenko

EASTERN PARTNERSHIP IN UKRAINE: FROM PARTNERSHIP TO MODEL OF DEVELOPMENT – STILL A WAY TO GO

Eastern Parternship (EaP) … it is hard to find a topic, which would be so much described and simultaneously would still be unclear on what it brings in the result.

The critics that the initiative was a substitute for the real EU approach of its Eastern neighbours appeared right after its public presentation. However, from the very beginning the initiative neither promised nor precluded the prospect of EU membership to the partner states. 
 
Two years old Eastern Partnership already knows “how to walk and starts talking”. This article aims at stocktaking of what the Eastern Partnership brought to Ukraine as well as to provide the analysis on its benefits’ maximization further on.

The authors of this article will deliberately omit the axis of “membership – non-membership” as it is a wrong approach a priori to assess the EaP in terms of its ability to pave the way to the EU membership. However, the EaP’s transformation potential – this will be the focus of the attention.

Evolution of expectations 
The EaP initiative, which was initially suggested by Polish and Swedish diplomats already in June 2008, and officially launched in Prague in May 2009, was aimed

“…to create the necessary conditions to accelerate political association and further economic integration between the European Union and interested partner countries…”[1].

With the EaP initiative it was meant that the EU Eastern neighbors were granted “their own club” in order to enhance the neighborhood policy of the EU. The fact of differentiation of the Eastern “block” of the European neighbours (versus Southern) was very important in terms of geopolitics. The first feedback of official Moscow regarding the EaP initiative could be considered to be an evidence for that, as Vladimir Putin compared it to: “an alternative to NATO’s expansion to the East”.
 
Actually this right strategic approach was one of the reasons why EaP was overestimated at its dawn. However, geopolitical declarations of further integration with the EU were based on the European Neighborhood Policy (ENP) and its financial arm – European Neighbourhood and Partnership Instrument (ENPI) basis. While numerous frameworks were introduced, the instruments of cooperation remained the same.
 
The realistic stance on the EaP uncovers that EU Eastern neighbors were offered the encouragement and support in their political, institutional and economic reforms based on EU standards as well as trade facilitation - with the help of Association Agreements (AA) including deep and comprehensive free trade areas (DCFTA) and comprehensive institution building (CIB) programs, together with visa liberalization.
 
Apart from that, it would be wrong to ignore the value of EaP mechanisms, operating on a number of levels (e.g. summits of heads of states & governments of the EU member states and the partner states, meetings of foreign ministers, multilateral thematic platforms of senior officials, Civil Society Forum, Parliamentary Assembly Euronest, group of friends of the EaP), as they actually enable the Eastern region to be heard.
 
Of course, already much criticized inadequate funding of the initiative deserves to be included into it the list of its weak points, however, in case with Ukraine, I would not name it as the most important one. What actually matters is the mode or the approach, used by both partners - the EU and Ukraine – in their cooperation.
 
After the official diplomatic euphoria has disappeared, partner countries had to wake up after “the New Year night party ” and to wrap up their European “presents”, which were €350m of fresh funds (and €250m, redirected from the ENPI Regional Programme East to EaP multilateral projects in the years 2010-2013).
 
The gap between geopolitical and instrumental dimensions of EaP might be the reason of initial overestimation of the initiative. However, the EaP can not and should not be blamed for the EU’s failure to prevent Ukraine’s political systems from becoming more authoritarian. A wider perspective should be applied here, thus the limitations of the ENP general framework are to be seriously considered. Even the European Commission while revising ENP in May, 2011admitted that
 
“more has been achieved in the economic sphere, notably trade and regulatory approximation, than in the area of democratic governance” [2].

Place of EaP in the ENPI matrix
The implantation of EaP funding into the ENPI only complicated the process of understanding of what EaP actually was, because the ENPI is governed by myriad of documents, spanning in validity from one to seven years, aimed at different regions, and emphasizing different types of cooperation.

Three components of ENPI – National, Regional (incl. both East regional and Interregional) and Cross-border cooperation (CBC) are equally prioritized by three levels of strategic documents [3]
EaP programmes: Comprehensive Institution Building (CIB), Pilot Regional development and Multilateral dimension are enchased into the ENPI through National and East Regional components. The figure 1. below demonstrates schematically the place of EaP programmes in the ENPI matrix.
 
Figure 1. ENPI and Eastern Partnership programmes
 
 
 
The European Commission, according to usual ENPI procedures, dispenses the EaP fundings. Moreover, depending on the specific projects the recourses are disbursed to various beneficiaries. For more details, see table 1.
 
Table 1. EaP Beneficiaries 
Programme
Beneficiaries
Comprehensive Institution Building programme
Public administrations of partner states, EU member states, and EU institutions involved in training and other institutional reform programmes
Pilot Regional Development Programmes
Public administrations of partner states, local authorities, SMEs and NGOs
Multilateral dimension
Commercial companies (which won in public tenders), NGOs and other organizations which received grants through public calls for proposals, public administrations of partner and EU member states.
  

To conclude: EaP being an inseparable part of the ENP automatically inherits its strong and weak sides. However, “the devil is hidden in the details” as a famous proverb says - and it is also true for the case with the EaP.

Institutional “raisin”
Knowing that the main focus of transformation in recent EU candidate countries was reform of institutions, the introduction of the Comprehensive Institutional Building [5] (CIB) programme within the EaP initiative seemed to be extremely right and correct step of the EU. This institutional dimension can be considered to be a prove for seriousness of European intentions to succeed in the process of Eastern neighborhood countries’ reforming.

Law capacity of Ukrainian government [6] to organize the implementation of the future EU-Ukraine association agreement only emphasizes the urgency and appropriateness of such institutional capacity building instrument in Ukraine. However, it appeared that CIB only meant to introduce a strategic framework for already known and used in Ukraine institutional building tools: Twinning [7], TAIEX[8] and Sigma [9] . Don’t you think, isn’t it too much of frameworks for the Eastern neighbors?

Unfortunately, CIB implies obligations of Ukrainian state institutions to reform themselves. The word “unfortunately” appears here only because Ukrainians are good at taking obligations; the problems appear while their fulfillment.
 
Neither Ukrainians no Europeans bothered themselves with analysis of reasons why the obligations (taken by Ukrainian policy-makers) in terms of reforms conducting are not being realized. Partially it happens because usually strategic documents in Ukraine are a kind of a “wish list”, that are never intended to be implemented. And these kinds of obligations are to be materialized in the Institutional Reform Plans, which in their turn form the basis for different institutional building tools application.
 
Main challenge of the CIB in Ukraine is that the European Commission does not imply the necessity of Ukrainian institutions to be able to fulfill the norms of the European legislation. And this is the basic problem with CIB. Because in case when the AA is singed (including DCFTA) Ukraine will be obliged to accept and follow certain European Directives in a number of sectors. And it would be logical to prepare Ukrainian institutions to fulfill this task, even if it looks the same as it was in the candidate countries before their accession. But, steady argument of the Europeans that “Ukraine is not a candidate country” diminishes the potential of possible institutional transformation in Ukraine. Thus, the officially proclaimed goal of the ENP to share “everything but institutions” [10] received its reflection and continuation in the CIB of the EaP initiative.

EaP in Ukraine: framework as a substitute
A simple task to make a comprehensive picture out of all the EaP projects that Ukraine (solely or in cooperation with other EU Eastern countries) takes part in appeared to be not an easy one. With the help of different pieces of information from both open and non-open sources, the authors of this article put together all the projects and programmes, which are either being or are planned to be realized under the EaP umbrella title. The Figure 2 below contains all the information uncovered.

Figure 2. Eastern partnership projects in Ukraine

 
The fact that it was not possible to find out the exact funding within ENPI Regional East component might be explained by the following: Ukraine does not sign annual Financial agreements (according to the regulations of the ENPI) which makes it is difficult to see the budget of the country in the general budget of the project.
 
Many projects that now are in the general list of the Eastern partnership projects were initiated and realized before the implementation of Eastern partnership initiative. Such projects as “Supporting participation of Eastern partnership and Central Asia Cities in the Covenant of Mayors”, INOGATE are being prolonged and spread over six EU Eastern partner-countries.
 
Only a few programmes were exclusively designed for EaP framework, e.g. “Comprehensive institution building programme”, “Pilot regional development programme of Eastern partnership” and “Support to multilateral dimension of the Eastern Partnership/Global Allocation”). 
 
Since Ukrainian governmental institutions were not reformed since the USSR breakdown in 1991, “governance” projects are very crucial in this case. Thus, the promotion of good environmental governance as well as strengthening institutional capacity for sustainable energy governance aims at changing the paradigm or a model of the governance. And this is exactly what is the most needed now in Ukraine. For more detailed information on EaP projects please, see Annex 1 of this article.
 
In other words, Ukrainian perspective of EaP programmes and projects cannot be presented in black-and-white colors. There are certainly bright points, which are to be exploit for further enlightening of the whole picture, while simultaneously there are those sports, which are to be covered with qualitatively new paints.
Moreover, since the initiative implies two sides for enhanced cooperation between the EU and one of its Eastern neighbour (we leave here deliberately multilateral dimension) than this is a two-ways road, in which both sides – in our case – Ukraine and the EU – are to be praised for successes or blamed for the failures.

Effectiveness of EU foreign aid coordination in Ukraine
The factor of how the resources of the EU foreign aid in general and EaP in particular are being used in Ukraine crucially influences the level of effectiveness of the latest.

Ukraine has been a recipient of foreign aid since it became independent. The EU and its member-states are among the biggest donors in Ukraine in line with the United States of America, Japan and Switzerland. Nowadays, when Ukraine is in dire need for reforms, every Euro or dollar of foreign aid has even more weight. The question arises, Will Ukraine be effective in overall management and development in case it is not able to effectively handle its own resources and those funds drawn from abroad? What are those criteria, which are to be used while assessing foreign aid coordination system?
 
The main general condition for effective drawing and usage of foreign aid is having a high political level of support in place and clearly defined national development strategic priorities to which the priorities for drawing aid and the system and mechanisms for managing such aid are connected.

Political backing
Support of the process of drawing and utilizing foreign aid is de facto present at a high political level. The First Vice prime minister, in fact, carries out the role of National Coordinator of all aid, even without formal attachment of this role. However, with the changes brought by the constitutional reform in Ukraine, the center of strategizing moved from the Cabinet of Ministers of Ukraine to the Presidential Administration. But it was not depicted in the system of foreign aid management, which creates a possibility for a gap to appear between the center of strategy definition (the Presidential administration of Ukraine) and a tactical center (the Ministry of Economic development and trade), which is defining the priorities for aid. Such gap might lead to “a parallel world” of foreign aid projects, which are not integrated into the comprehensive picture of Ukrainian national strategic development. 

Coordination system
The Ministry of Economic development and trade in Ukraine undertakes overall coordination tied to the drawing, utilization and monitoring of international technical assistance, in accordance with Presidential Decree №1238 of 1 November 2003, Cabinet Resolutions №153 of 15 February 2002 and №777 of 26 May 2007. Within the Ministry responsibility for international technical assistance matters is delegated to the Department of International Technical Assistance and Cooperation with International Financial Institutions.

However, this Department has a broad range of functions in terms of managing aid and this covers nearly all stages, from strategic planning to operational work, e.g. registering projects. Still the size of the staff in the Department is too small to clearly delineate responsibility, separate out functions and ensure aid effectiveness. Moreover, a number of key functions, such as evaluating the effectiveness of how aid is used are not handled at all in practice of this Department.
 
In case with the EaP projects and programmes, not only Ministry of Economic development and trade in Ukraine, but also Main department of Civil Service, Ministry of Foreign Affairs and Ministry of Regional Development, Construction and Housing & Communal services are involved into the coordination process.

Strategic guiding line
Ideal situation would be if Ukraine has one strategic document, which would contain maximum five strategic development priorities in a middle-run perspective for which various form of foreign aid are drawn (it makes international donors’ fund auxiliary) to national state budget resources. This is not the case in Ukraine for now. The financial planning of foreign aid programmes and projects is not seen as an additional source to support the carrying out of the country’s strategic development programmes.

Thus, the system of coordination of foreign aid resources in Ukraine form a certain ground for further development of EaP initiative, at least locally. It is too early to say that the current ground is good enough to enable full realization of strategic potential of the EaP programmes and projects. There is still an obvious gap between a strategic center of reforms in Ukraine and a place where the instruments for reforms are being placed.

Moving forward
Eastern partnership, being an integral continuation of the ENP, did not have at the beginning clearly formulated goals.

The European Council conclusions as of 20 March 2009 presenting the guidelines of the EaP include the following statement [11]:
 
“The Eastern Partnership will bring about a significant strengthening of EU policy with regard to its Eastern partners by seeking to create the necessary conditions for political association and further economic integration between the European Union and its Eastern partners. The Eastern Partnership will also help to build trust and develop closer ties among the six Eastern partners themselves.”
 
However, it does not mean that the membership perspective is to be obligatory defined. On the contrary, it’s high time to leave for the moment this membership rhetoric, which would be acceptable for both sides: the EU and Ukraine.
 
Instead it would be good for Ukraine and the EU to concentrate all the efforts on reform process in Ukraine. Thus, ENPI funding, including EaP possibilities, are to be re-focused on institutional transformation, providing so necessary conditions for political association and economic integration.
 
Moreover, by at large, one of the mega-aims of the EaP – is to contribute to enabling Ukraine to fulfill future Association agreement. As the agreement and especially its Deep and Comprehensive Free Trade Agreement is a compulsory in its nature. Certain elements of the EU market are to be opened up to Ukraine on conditions, that a country has adopted the relevant regulations applicable in the EU. The partners foresee the dispute solving mechanisms in cases of obligations breach, in which the Court of Justice of the EU is the next instance to be referred to.
 
Up till now Ukraine did enjoy foreign aid, devoted to policy elaboration, but the institutional capacity to realize those policies was never considered. However, it’s the EU who is experienced in introduction of national systems of trainings aimed to establish democratic standards of state governance in different spheres.
 
The system of foreign aid management in Ukraine is to be revised in order to be able to integrate the resources of the EU – which are to be reforms instruments – into the strategic matrix of national development.

The disproportion between EaP policy ambitions and the instruments, available, is to be eliminated. Being launched from a partnership status, the EaP is to become the set of measures (political and economic) in order to empower the development of Eastern neighbours according to the Western Europe countries’ model. And in case this development is successful, the membership issue will be solved by default.
 

ANNEX 1. ENPI, Eastern Partnership, Ukraine: short projects’ description  

1. National component ENPI includes:
 - Comprehensive institution building programmes.
Budget: 175 m. €. (40 m. Є. - Ukraine). Duration: 2011-2013.
The main objective of the programmes is to improve the institutional performance of the partner states, and their compatibility with EU institutions. They will be implemented through twinning and TAIEX programmes, exchanges, professional placements and internships, the secondment of personnel to sister-institutions in interested member states, and scholarships for professional training[12].
 - Pilot regional development programmes.
Plans for PRDPs will be modelled on EU cohesion policy. Their aim will be to contribute to the development of local infrastructure, human capital, and small- and medium-sized enterprises in the least developed regions of the partner states[13].
 
A)     Pilot regional development programme.
Budget: 12 m. €. (2 m. Є. - Ukraine). Duration: from 2012[14].
The main objective of the programme is to launch cross-border cooperation between Eastern Partnership countries without the involvement of EU member-states[15].
 
B)     Pilot regional development programme.
Budget: 60 m. €. (29 m. Є. - Ukraine). Duration: from 2013[16].
The main objective of the programme is to launch cross-border cooperation between Eastern Partnership countries without the involvement of EU member-states.
 
2.          ENPI Regional East Action Programme includes:
- Projects:
 A)    Supporting participation of Eastern partnership and Central Asia Cities in the Covenant of Mayors.
Budget: 5 m. €. Duration: from 2012.
The overall objective of the proposed project is to support the local authorities in Eastern Europe, the Caucasus and Central Asia to reduce their dependency on fossil fuels, to improve security of their energy supply, and to allow them to contribute more actively[17].
B)    Support to energy security in the Eastern Partnership and Central Asia states through statistical cooperation (INOGATE).
Budget: 4 m. €. Duration: 2011 – 2015.
The overall objective of the proposed project is to increase energy market convergence and security of energy supply in the INOGATE Partner Countries[18].
C)    INOGATE: Strengthening institutional capacity for sustainable energy governance in countries covered by the EaP.
Budget: 4 m. €. Duration: 2011 – 2015.
The overall objective of the proposed project is to support the INOGATE Partner Countries reduce their dependency on fossil fuels and imports, to improve security of their energy supply, and to allow them to contribute more actively to climate change mitigation[19].
D)    Turn-Around Management and Business Advisory Services Programme in Eastern Partnership countries
Budget: 5  m. €. Duration: 2010 – 2013.
The overall objective of the proposed Programme is to promote the economic transition of the countries of the EaP region towards market economies through: advice to, and mentoring of, the SME sector; development of a sustainable infrastructure of business advisory services and contribution to improving the policy and regulatory environment for business[20].
E)    Support to multilateral dimension of the Eastern Partnership/Global Allocation.
Budget: 17,25 m. €. Duration: from 2011.
The objective of the project is two fold: 1- to advance the implementation of the multilateral dimension of the EaP and of the Black Sea Synergy and Northern Dimension; 2- to ensure rapidity of the commitment decision on actions and projects, while enabling the European Commission to act with flexibility through the use of an instrument capable of adapting to evolving circumstances, such as dealing with unforeseen situations[21]  .
  
- Multilateral dimension (projects and flagship initiatives):

- Eastern partnership thematic platform #1 “Democracy, good governance and stability”:

Budget: 44, 5 m. €. Duration: from 2010.
General objectives: alignment of the partner states' law and practices to EU standards of IBM; exchange of best practices on matters related to IBM, including through the IBM Panel; provide training and capacity building on IBM matters[22].
Budget Phase 1: 6 m. €. Duration: 2011 — 2014.
Budget Phase 2: 6 m. €. Duration: will be determined by the results of the Phase 1.
General objectives: to strengthen disaster management capacities and improve co-operation between the EU and the partner states and among themselves[23].
 
- Eastern partnership thematic platform #2 “Economic integration and convergence with EU policy”:
  • Flagship initiative “To promote good environmental governance”. Phase 1 and Phase 2.

Budget Phase 1: 1.8 m. €. Duration: from 2009.

Budget Phase 2/Duration: will be determined by the results of the Phase 1.
General objectives: increasing the availability of reliable information in partner countries by including them in the EU Shared Environmental Information System[24]
  •  Flagship initiative “Small-and Medium-Size enterprise facility.”
Budget: 57 m. €. Duration: 2010-2013.
General objective is to support for small- and medium-size business[25].
The flagship initiative will consist of three components:
a)      Programme “East-Invest”;
b)      Programme EBRD/ВАS;
c)      SME facilities[26].
  • Project “The effectiveness of entrepreneurship policy”.
Budget/Duration: planed..
The objective is business policy analyses in the Eastern partnership countries for reviewing the enterprise policy on the base of the European Small Business Act and identifying priorities for reforms[27].
  • Project "Challenges and benefits of labor mobility between the EU and Eastern Partnership countries".
Budget\ Duration: planed[28].
 
- Eastern partnership thematic platform #3 “Energy security”:
  • Flagship initiative “Regional energy markets and energy effiency”.
Budget: 41 m. €. Duration: from 2011.
General objectives: Advice and financial support on the interconnection and harmonisation of energy markets; strengthening institutional capacity for sustainable energy governance within the framework of the INOGATE; improving energy efficiency and increased use of renewable energy sources[29].
 
- Eastern partnership thematic platform #4 “Contacts between people”:
  • Project “Eastern partnership Culture Programme. Part 1 & Part 2”.
Budget Part 1: 3 m. €. Duration: 2010 – 2014.
Budget Part 2: 9 m. €. Duration: 2010 – 2014.
The overall objective of the regional Eastern Partnership Culture Programme is to support the role of culture in the region's sustainable development and to promote regional cooperation between public institutions, national and local; civil society cultural organisations both profit and non-profit; and foundations and academic organisations in the Eastern Partnership region and the EU[30].
  • Project “Eastern partnership window to the Youth in Action programme”.
Budget\Duration: planed.
The overall objective of the project is to promote mobility of young people through intercultural exchange and mutual support, building institutional capacity and support youth NGOs to strengthen civil society in  Eastern Partnership countries[31].
  • Project “Cultural preservation”.
Budget\Duration: planed.
The overall objective of the project is to support the cultural and archaeological heritage[32].
  • Project “Kyiv initiative in education”.
Budget\Duration: planed.
The overall objective of the project is to implement the European standards in school education in Eastern partnership countries[33].
 


[1] Joint Declaration of the Prague Eastern Partnership Summit, http://www.consilium.europa.eu/ueDocs/cms_Data/docs/pressdata/en/er/107589.pdf
[2] European Commission communication, ‘Taking stock of the European Neighbourhood Policy’,COM (2010) 207, May 12th 2010.
[3] S. Tessier-Stall, V. Gumenyuk, O. Shumylo, S. Kaltygina, “ENPI Monitoing in Ukraine”, (2009), p. 18
[4] The EU Financial Perspective is the seven-year budgetary framework agreed by the Council, the Commission, and the Parliament.
[5] Comprehensive Institution Building Programme is a component of the European Union's Eastern Partnership initiative to provide institutional capacity building of key governmental bodies towards creation of prerequisites for implementation of the future EU-Ukraine Association Agreement and creation of deep free trade area.
[6] “Capacity assessment of the Government to organize implementation of the EU-Ukraine Assosiation Agreement ”, report of the International Centre for Policy Studies 
[7] Twinning is a technical assistance instrument, which aims to contribute to the development of modern and efficient administrations through the long-term secondment of public servants from EU Member States to the public administrations of beneficiary countries. (Source: http://ec.europa.eu/enlargement/how-does-it-work/technical-assistance/twinning_en.htm )
[8] TAIEX (Technical Assistance and Information Exchange Instrument) provides centrally managed short-term technical assistance in the field of approximation, application and enforcement of European Union legislation. (Source:http://ec.europa.eu/enlargement/taiex/)
[9] SIGMA (Support for Improvement in Governance and Management), a joint EU-OECD initiative (mainly funded by the EU) whose role is “to assess the progress in reforms [and] to assist beneficiary administrations [in establishing] good public sector practice and procedures (Source: http://www.sigmaweb.org/pages/0,2987,en_33638100_33638151_1_1_1_1_1,00.html)
[10] Romano Prodi (President of the European Commission) Speech 02/619 – source: http://www.exclusion.net/images/pdf/567_veqot_PRODI_ECSA_en.pdf
[14] Document from the Ministry of Foreign affairs of Ukraine on possibilities of cooperation in Eastern partnership initiative. 01.08.2011.
[15] Letter from the Ministry of economy of Ukraine to the Cabinet of Ministers of Ukraine on EU technical assistance for 2011-2013.
[16] Document from the Ministry of Foreign affairs of Ukraine on possibilities of cooperation in Eastern partnership initiative. 01.08.2011.
[17] Annex 1: Action Fiche for ENPI Regional East Action Programme 2010 Part 1, p. 15
[18] Ibid, p. 28.
[19] Ibid, p 39.
[20] ACTION FICHE. ENPI East Regional Action Programme 2010 Part III, p. 5.
[21] Annex 1: Action Fiche for ENPI Regional East Action Programme 2010 Part 1, p. 98.
[23] Ibid.
[24] Ibid.
[25] Ibid.
[26] Letter from The Ministry of economy of Ukraine to Civic expert council. № 4701-25/223. 09 .08.2011
[27] Letter from The Ministry of economy of Ukraine to Civic expert council. № 4701-25/223. 09.08.2011
[28] Ibid.
[30] Annex 1: Action Fiche for ENPI Regional East Action Programme 2010 Part 1, p. 4.
[31] Letter from The Bureau for Eurpean integration Secretarait of the Cabinet of Ministers of Ukraine to the Civic expert council.  № 52/56. 03.12.10.
[32] Ibid
[33] Ibid