27.10.2017

Ukraine: Improving transparency in public procurement

How a start-up in Ukraine is supporting the fight against corruption.

Ukraine is getting closer to EU membership. In 2014, the partners signed a joint association agreement. Its objective is ever-closer cooperation – particularly on matters concerning the economy. To achieve this, Ukraine is looking to ensure greater transparency and to step up the fight against corruption within its borders. Currently, around one fifth of the state budget planned for public purchasing is lost as a result of mismanagement and corruption. The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH is supporting the Ukrainian Government with its reforms on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).

For example, GIZ supports the innovative online platform ProZorro in its efforts to stem corruption in public award procedures. ProZorro was initiated on a voluntary basis by young IT specialists to lend greater transparency to bidding processes in public invitations to tender. The online platform is now established and its use by the Government mandatory for all procurement. If the Ukrainian state were to issue a tender to build a road or purchase schoolbooks, for example, ProZorro now makes publicly available information on which companies have applied and what they are offering. Since this encourages a fairer bidding procedure, more suppliers are inclined take part in competitive tenders. ProZorro is also working towards the creation of a free market. Furthermore, over EUR 1 billion has been saved since the system was introduced in 2016.

ProZorro is a significant fiscal innovation and has won a number of international awards – including the 2016 Golden Open Government Award and the 2016 World Procurement Award, which recognises new ideas for fairer procurement and contracting.

In addition to fighting corruption, GIZ works globally to improve access to state services and to promote greater political participation. Over 91 million people worldwide benefited from public services between 2010 to 2015 as a result of GIZ’s activities.