USAID-Ukraine Partnership

Back in 2004, hundreds of thousands of Ukrainians filled Kiev’s Independence Square, successfully challenging the widely disputed results of the country’s presidential election. At the time, the popular uprising — which came to be known as the Orange Revolution — seemed to put Ukraine squarely on a democratic path while also raising hopes for its economic renewal. Yet nine years since the Orange Revolution captured the world’s attention, Ukraine continues to struggle with its transition from authoritarian rule. Ukraine’s progress on its democratic reforms over the past decade has been uneven and inconsistent, analysts say. Most recently, parliamentary elections in October 2012 were marred by widespread allegations of irregularities. Citing deteriorating press freedom as well as government hostility toward opposition gatherings and foreign groups, the U.S.-based Freedom House downgraded Ukraine in 2011 from “free” to “partly free” in its annual assessment of civil liberties worldwide. Meanwhile, serious structural weaknesses — including a cumbersome regulatory regime and significant fiscal imbalances — have hampered the Ukrainian government’s efforts to jumpstart growth following the global financial crisis. Ukraine’s economy slipped into recession in the second half of last year. Economists forecast the country’s real gross domestic product will register sluggish 1 percent growth in 2013. In its 2012-16 country strategy for Ukraine, the U.S. Agency for International Development reaffirms Washington’s development partnership with Kiev. Through 2016, USAID programming in Ukraine aims to achieve the following objectives: - Foster more participatory, transparent and accountable governance processes. - Support broad‐based, resilient economic development. - Improve health status. - Support the cleanup of the Chernobyl nuclear plant. - Combat human trafficking. Funding levels For fiscal 2014, the Obama administration has requested $95.3 million in foreign assistance to Ukraine, 8 percent below fiscal 2012 levels. The United States is Ukraine’s largest bilateral donor. Click on the image to view a larger version of the table. USAID delivers the bulk of U.S. foreign aid to Ukraine. In fiscal 2014, 59 percent of U.S. foreign assistance to Ukraine is expected to flow through the U.S. aid agency. In recent years, the U.S. Department of State, the U.S. Department of Energy, and the U.S. Department of Defense have also channeled significant amounts of U.S. foreign assistance to Ukraine. Funding priorities (fiscal 2014 request) Click on the image to view a larger version of the table. For fiscal 2014, the Obama administration has requested $31.6 million in peace and security assistance to Ukraine, representing 33 percent of proposed U.S. aid spending in the country. The lion’s share of U.S. peace and security assistance to Ukraine continues to fund USAID’s efforts to help restore the Chernobyl nuclear plant to an environmentally safe and stable condition. The administration anticipates that it will complete its pledged commitments to assist with the cleanup of the Chernobyl site by 2016. Meanwhile, the Obama administration has allocated $28.7 million (30 percent) of its proposed fiscal 2014 aid budget for Ukraine to the health sector. The administration has earmarked $23.7 million in U.S. President’s Emergency Plan for AIDS Relief-linked funding for HIV and AIDS prevention, care and treatment programs across Ukraine. In February 2011, the Obama and Yanukovych administrations signed a Partnership Framework agreement which committed both governments to continued cooperation against HIV and AIDS. Ukraine has one of the most severe HIV and AIDS epidemics in the region. While the vast majority (89 percent) of PEPFAR-linked assistance to Ukraine in fiscal 2014 will be managed by the State Department, USAID will also be administering about a tenth of U.S. HIV and AIDS funding for the country. In addition to providing HIV and AIDS assistance, USAID supports tuberculosis treatment as well as family planning and reproductive health programs in Ukraine. Another focus area for the Obama administration’s foreign aid program in Ukraine is democracy, human rights and governance, for which $17.9 million has been requested for USAID assistance to the sector for fiscal 2014. USAID Ukraine’s priorities in the sector include raising the legislative and policy environment to European standards and improving citizen oversight and engagement in governance. In line with USAID’s country strategy for Ukraine, the Obama administration has also earmarked $654,000 for USAID Ukraine’s anti-human trafficking initiatives in fiscal 2014. These initiatives include awareness raising activities among at-risk groups, vocational and job skills training programs, and reintegration assistance to victims. Devex analysis Keen on restoring Kiev’s once-warm ties with Moscow, Viktor Yanukovych’s election as president of Ukraine in 2010 had sparked fears over the future of U.S.-Ukrainian relations. In the years since, however, the Obama administration has continued to pursue close cooperation — in large part through its aid and development engagement — with Ukraine. Only last month, while welcoming his Ukrainian counterpart Leonid Kozhara to Washington, U.S. Secretary of State John Kerry pledged the administration’s commitment to “helping Ukraine work to become a prosperous European democracy.” USAID Ukraine manages programming for two of the Obama administration’s signature global development initiatives: the Global Health Initiative and the Global Climate Change Initiative. Ukraine recently outpaced Georgia to become the largest recipient of U.S. foreign assistance in Europe and Eurasia. On the other hand, the widespread perception in Washington that the Yanukovych government has backslid on democratic reforms may yet prompt the Obama administration to reevaluate its development partnership with Kiev. In fact, USAID’s strategy for Ukraine asserts that the centralization of power in the executive branch and poor government effectiveness are the main challenges to the country’s development. Echoing concerns among some leading members of Congress, the White House has publicly raised questions over the Yanukovych government’s adherence to democracy and the rule of law. Join the Devex community and access more in-depth analysis, breaking news and business advice – and a host of other services — on international development, humanitarian aid and global health.