Local development and regional policy in Ukraine and beyond

First panel

Panelists:

• Vlad Mykhnenko, PhD, Associate Professor in sustainable urban development, researcher at St Peter’s College of the University of Oxford;
• Olga Mrinska, PhD, ambassador and trustee of the Regional Studies Association, Associate Director and Senior Evaluation Manager at the European Bank for Reconstruction and Development;
• Igor Ksenych, PhD, Associate Professor at the Department of Cultural Identity Studies of the Institute of European Culture in Gniezno of the Adam Mickiewicz University (Poznan);
• Olga Shevchenko, PhD, head of the Regional Development Strategy sector at the National Institute for Strategic Research.

Moderator: Pavlo Fedoriv, urban geographer and housing policy analyst at the Cedos Think Tank.

Vlad Mykhnenko

• We wrote the article Ukraine’s diverging space-economy: The Orange Revolution, post-soviet development models and regional trajectories based on the available data until 2007, and it was probably the first article in English which considered the issue of regional divergence in Ukraine. It was interesting to us that a methodological paper which considers the typology of Ukraine’s spatial economy from the perspective of specialization of various Ukrainian regions produced a rather simple triple typology in which most Ukrainian regions specialized in agriculture as of mid-2000s. Four regions specialized in heavy industry, and a few other regions focused on services.

• I have always been interested in seeing the extent to which the level of disproportions in Ukraine can be compared to other countries or trade blocs. According to the data of 2008, the level of disproportion in Ukraine was rather high: it was in the top 5 countries of the world. Russia, Indonesia, Mexico and India had higher regional disproportions.

• Then we considered how decentralization affected regional disproportions across the world. Between 1995 and 2015, various countries, various trade blocs saw different trends. Some countries were decreasing their regional disproportions. Russia started decreasing its regional disproportions from 2005 on, the EU decreased its regional disproportions, while NAFTA, the US, Australia, on the contrary, saw their disproportions increase. In 2018–19, the Organisation for Economic Co-operation and Development published a paper entitled Support for the Process of Decentralization in Ukraine, which answers certain questions about the effects of decentralization and about how decentralization correlates with regional development. Similarly to what I did, the authors of this paper compared the levels of disproportions in different countries. Ukraine was at the top, below Columbia, Indonesia and Russia. But Ukrainian disproportions were not just high, they also increased between 2003 and 2015. Ukraine must restructure its policy from the old paradigm to the new one. The summary of this paradigm was published in OECD’s regional review of 2019, presenting the characteristics of the contemporary local regional policy.

Olga Mrinska

• Today, there are no differences in the understanding of regional policy and what its goals should be. Ukraine meets the European standards. The process we have achieved in the field of fiscal decentralization, decentralization of powers in favor of local government bodies is actually the required minimum which we discussed in 2001 and which has finally been realized. We have overcome the two biggest obstacles on the path to the endogenous development of regions.

• We have created expert centers at the central level, we have strong reform teams in the regions that are responsible for helping local government bodies, united communities. The number of actors at the regional level is increasing, but I am not sure that the government’s capacity to maintain dialogue with these partners is sufficient. I must disagree that regional policy is a state policy. That is the case in Ukraine, but if we look at the theory, regional policy is actually the policy of cities, territories that have powers depending on the level of decentralization and deconcentration of powers; it is also about mutual relations.

• We cannot ignore the fact that we have occupied territories and are at war, so the most important thing is security and ensuring unity or cohesion. In my opinion, what our policy lacks is a clear theory of change. How will the investment and contributions we make today bring us long-term results in 5 years? We focus on contributions and short-term results. Although we have a synergetic effect from regional policy in theory, in practice it is not happening.

• We must distinguish between policy and politics. When Mr. Minister Oleksiy Chernyshow said in his speech on adopting the State Regional Development Strategy that “regional policy must be outside politics,” I can disagree with him: it must be above politics. It means that the actors and politicians involved in it must have a clear understanding and must play according to some rules—unfortunately, we do not have that. But Europe has the exact same problem. If we look at the priorities in the EU’s cohesion policy for the next 7 years, everyone is talking about backsliding, that this policy has no unified logical long-term strategy.

• We idealize what is going on in Europe. First of all, the divergence of approaches. For instance, what is happening in Hungary today: centralization of power, cities have lost their self-governing status entirely. Ukraine should look at the examples of the European Union, but we have a great advantage: we are not its members. Therefore, we do not have to follow all the rules and regulations which add an additional level of bureaucratization.

Igor Ksenych

• I will start by explaining how local development is viewed in Poland. Local development is an economic term, and it is only possible under the conditions of decentralization. However, I would like to draw your attention to a few threats associated with decentralization. These are the opinions of two legal science researchers in Poland, Zbigniew Leoński and Hubert Izdebski. First, when decentralization is not accompanied by simultaneous democratization and the rule of law, this leads to oligarchization. Second, in the countries which have a tradition of the “vertical of power”—Ukraine and its Soviet heritage can be an example here—decentralization may turn into a caricature and a pathology of decentralization. And finally, the third aspect is that under emergency circumstances, such as a natural disaster or war, there should be no decentralization; under these conditions, cohesion is needed, and the state must be centralized.

• I would like to draw your attention to the differences within the word “local” itself. If we look at the Polish self-government model, we are not talking about local, but rather about territorial self-government. “Territorial” is used in Ukrainian in relation to the administrative-territorial division, but not applied to self-government. Local self-government in Poland means what is the closest to the people. In Poland, local self-government is what happens at the basic self-government level (gmina) and at the middle level (powiat), because a region is a different type of self-government at the level of województwo. So there is a difference between local and regional self-government. Meanwhile, in Ukraine, we speak about local self-government at all levels: community, district, region. This has consequences. In Poland, we deal with communities at all levels of local self-government. This is not the case in Ukraine: according to the law on local self-government, district and regional councils represent the shared interests of communities.

• What is the development policy in Poland? First of all, it is a system of actions whose goal is to ensure the country’s long-term and sustainable development, cohesion, competitiveness of the economy, job creation on the national, regional, and local scale.

Olga Shevchenko

• Since Ukraine is currently going through stages of decentralization, and the domestic and foreign political situations have changed significantly on top of that, regional policy itself has become rather different, and I would like to emphasize its following four characteristics:
  • defining the principles of implementation of the state regional policy;
  • defining the functional types of territories which become the objects of regulation by the state regional policy;
  • taking into account the strong influence of the local self-government reform and the territorial organization of power on the changes of the actors of regional policy;
  • transitioning to the construction of the foundations of local development.

• How do we, researchers in Ukraine, evaluate local development? Local development is viewed as the synergy of the actions of multiple actors that have influence over regional and local policies. It is a mutually coordinated action by business structures, civil society organizations, local executive government bodies, local self-government bodies, research and expert circles, and all the citizens involved in the process of shaping further development strategies. We define the goals of local development as those that concern the development of the economy and social sphere, human capital, building civil society on the ground.

• The first characteristic of the state regional policy is the embodiment of the principles of regional policy. They were regulated in various legislative acts even before. We can add new principles to the ones defined in them, such as the principle of innovativeness, developmentality and upholding interests. Without taking into account the interests of all actors, all subjects of implementation of the state regional policy, there can be no stable community development aimed at achieving goals.

• Distinguishing between the functional types of territories means that we are already gradually implementing the principles of local development and territorial approach, since this policy is not applied to all territories, but rather to specifically defined types.

• One of the goals of regional policy which is actually the target of all administrative influence has been the significant disproportions in the socioeconomic development indicators between regions. We can see that some of them did not change between 2007 and 2019, and some have increased considerably. These are mostly the indicators that characterize foreign economic activities, bringing in direct investment, export and import activities. In fact, this is another factor which signifies that we should move on to targeted projects capable of unlocking the internal developmental potential of regions, so that the issues of disproportions can be, if not eliminated entirely, then reduced to some extent.

• The increasing role of communities in the implementation of state policy means that both in science and in practice, we must shape the definition of what a community is and what set of administrative, financial, resource, property powers it must have in order to become a full actor of the state regional policy. The increasing role of local development institutions signifies that we should look for a different instrument for stimulating local economic development.

Second panel

Panelists:

• Andriy Ocheretnyi, Deputy Mayor of Vinnytsia;
• Jacek Jaśkowiak, Mayor of Poznań (Poland);
• Bella Tskhvelishvili, Eastern Partnership Program Coordinator in the Platforma project, a network for collaboration between local and regional government bodies (Belgium);
• Lizaveta Chepikova, representative of an interdisciplinary activist organization in the field of urban development (Belarus).

Moderator: Roman le Quiniou, director of the Euro Creative Think Tank (France) specializing in economic and regional development in Central and Eastern Europe.

Jacek Jaśkowiak

• Before I became the mayor of Poznan, I was involved in many activities in culture and sports. I had the opportunity to meet a lot of people who were active members of civil society. It was easier for me to start working with non-governmental organizations because, on the one hand, these people trusted me and I trusted them. It was a good opportunity to use the potential and give them funds which would be used to solve certain problems.
• We have created an opportunity to use a public space where people could gather and discuss certain issues. Some non-governmental organizations did not have a very positive attitude towards the city council. They often criticized us, particularly on specific topics, but their goal was positive, they wanted to change something for the better. If it was impossible to take into account all of their demands, it was possible to reach joint decisions. If we have certain resources, we try to support non-governmental organizations, because I believe that this is the best way to develop society and create change.
• We organize a system of grants. We have a special commission operating on a daily basis which includes members of various organizations, from various fields, who work on the city’s development. If we are organizing a certain event related to culture, sports, the environment, the people who want to join must apply for a grant and thus receive funding for their project. We have access to the expert circles who have information, because the mayor does not have expertise in everything.

Andriy Ocheretnyi

• We have successfully perfected the strategic document until 2030, which now takes into account the territorial changes. Our city of Vinnytsia has already become a territorial community, like most cities in Ukraine. We included the key aspects and principles into the new strategy. First of all, we established that every resident of Vinnytsia is important; the second principle is transparency and intolerance of corruption, as well as sustainability, engagement and cooperation.

• Decentralization has provided us with higher budget revenues, and we have the opportunity to do more. As for 2020, it allowed us to adopt the Vinnytsia Residents Are Important program. When the pandemic started, we defined three priorities for fighting it: social security, health care, economic development.
• Vinnytsia has created the first municipal hub for civil society development in Ukraine, and it translated into the creation of the City of Meanings Network. The Network includes 47 organizations, they self-organize and submit their suggestions. The key node is the communal enterprise City Development Institute, which coordinates these issues. As for the dialogue between the government and the community, we also have a number of mechanisms which we take from the people’s initiatives: the system of petitions and the public initiative budget.

Bella Tskhvelishvili

• We are a coalition of local governments and various local associations. The decentralization collaboration is the collaboration between local governments from Europe and their colleagues from partner countries. Platforma is a pan-European coalition of local governments from European countries and their associations working in local development. Since 2015, Platforma has been developing the Eastern Partnership program which aims to strengthen local and regional governance and develop the potential of local governments, particularly in Georgia, Moldova, and Ukraine.

• The main obstacle for us is how to make local politicians the main actors. In the countries which used to have centralized governments, particularly in post-Soviet countries, there are problems with local governments and with competences at the local level. Our main goal is to ensure networking between regional, local and central, supranational policies. Our main goal is to combine local policy with supranational policy.

Lizaveta Chepikova

• The Minsk Urban Platform is a non-governmental organization founded in 2014. In 7 years, we have conducted a number of educational events, and we work on various territorial development projects. I want to say that we work a lot with various municipalities. Until 2019, we had a number of participatory projects in Minsk. There is distrust of non-governmental structures in our country, so within these projects, we worked on uniting society. Many companies create obstacles to such projects.

• We faced problems in the implementation of one of our projects. There was this situation in cities, particularly in Minsk, a community was organized which started a few initiatives, initiated fundraising for purchasing personal protective equipment for various medical institutions. The second problem in the implementation of this project was access to water: water in several city districts was poisoned, people couldn’t wash their hands, they had problems with skin on their hands. These city districts had to receive water from other districts. This was the second case when this community, association of people worked well.

• Before the election, many organizations joined the election process, a lot of success was achieved, but then the election day happened, which changed everything in our lives. It changed our approach to using messaging apps, to using social media. Three days after the election, there was a lot of confrontation in the streets, the internet was blocked, people could only read the news on Telegram using VPN. As for various communication platforms, they also became popular. Our specialists say that local chats are associated with neighborhood communities, but it is not exactly the case. This structure is much more complex, and for this, you need to understand what a neighborhood community looked like in 2020-2021. The question we asked community members was, “How do you position yourself and how do you understand this community?” The answer surprised us. People said that a neighborhood community is not participating in the chat, it is the people who actively participate in the neighborhood’s life, they gather in the yard of the building they live in. People reformatted, people created chats, they gathered in groups according to territories. In a few days, a network of communities emerged, people living near a certain place started coming together. An interactive dialogue was created where people could look up the map, look up the new non-administrative districts created thanks to these decentralized initiatives in Minsk.

We had problems with communication with government bodies before as well. In the past 28 years, all non-governmental organizations have been marginalized. In the past few years, we have been trying to establish some kind of dialogue and develop an agenda with our city. But we have a lot of problems because the city government does not want to hear civil society organizations, and now the situation has become even worse. We have completely different agendas and see the development of Belarus and our cities in particular in different ways. This is a problem for us because we have many initiatives, but it is hard for us to expect any change because all of our actions are blocked by government bodies.