The recently developed electronic procurement system in Ukraine gained international recognition and significantly reduced corruption in public procurement.
Ukraine has been implementing a robust public procurement reform program over the past two years with the goal of reducing corruption. Ukraine has been losing approximately US$2.4 million annually due to corruption in public procurements. The centerpiece of the reform is the eProcurement system called ProZorro. Originally developed by a group of Ukrainian volunteers from civil society and the private sector, ProZorro was piloted in 2015 throughout Ukraine and then transferred to the Ministry of Economic Development and Trade (MEDT) in early 2016 for nationwide release. As of August 1, all public institutions of all levels are required to use ProZorro for their procurements.
In May 2016, ProZorro received the World Procurement Award that acknowledged the system’s major breakthrough in the procurement field.
Since early in 2015, MSI, A Tetra Tech Company, has assisted in assuring effective ProZorro implementation and procurement reform through USAID support. We developed a technical and business requirement assessment and recommendation for the ProZorro system strengthening and expansion, recommendations for professionalization of the procurement field in Ukraine, and advised the Kyiv City Administration with establishing a Procurement Competence Center for government and business users of ProZorro. MSI also worked to improve monitoring and audits of procurements to reduce fraud and corruption.
In June 2016, MSI conducted a survey of businesses across Ukraine to learn about their experiences using ProZorro. More than 300 businesses participated in the web-based survey. Results show that corruption in public procurements dropped by 25 percent with the use of ProZorro – from corruption occurring in 54% of procurements under the traditional system to 29% under ProZorro. Business confidence in the public procurement system is also on the rise – 27% of respondents believe that the system completely eradicates or largely reduces corruption and 53% believe that it reduces corruption partially. These results are attributable to the improved transparency and simplification of the procurement process using ProZorro.
MSI, in partnership with the ProZorro team at the MEDT and the Kyiv City Administration, will present results of the survey on August 19, 2016 for public and private sector stakeholders, as well for CSOs and the media.