Ukraine ducks agreement with EBRD on fighting corruption

by Reuters
Tuesday, 5 November 2013 15:52 GMT

Suma Chakrabarti, President of the European Bank for Reconstruction and Development (EBRD), address an audience during the bank's 2013 Annual Meeting and Business Forum in Istanbul May 10, 2013 REUTERS/Osman Orsal

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KIEV, Nov 5 (Reuters) - Ukraine on Tuesday backed away from signing an agreement with the European Bank for Reconstruction and Development EBRD.UL to step up its fight against corruption and improve a deteriorating business climate.

The ex-Soviet republic had been slated to ink the Anti-Corruption Initiative, EBRD sources said, but the bank's President Suma Chakrabarti dropped plans to visit Kiev after learning the Ukrainian side was not ready to sign yet "for technical reasons."

The initiative forsees an independent body being set up to examine complaints from companies working in Ukraine about the way they are treated by tax and customs officials and courts.

"The absence of the president ... is due to the failure so far to sign the anti-corruption initiative," an EBRD official said, adding the delay was costing Ukraine hundreds of millions of euros in lost EBRD investment.

The international lender invests about $1 billion a year in the former Soviet republic.

As Ukraine moves towards signing landmark agreements on association and free trade with the European Union at the end of November, the EBRD is pushing it to take more robust action to improve the work climate for investors and businesses.

The EBRD source said officials were still at work to secure a signing of the initiative at some point in the future.

"We would like to move this on as quickly as possible. It is for the good of Ukraine. It is not a cure but it is a signal of intent to solve a problem that is holding back Ukraine's transition," the EBRD official said.

(Writing By Richard Balmforth; Editing by Janet Lawrence)

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