Напрями вдосконалення механізмів державної допомоги в Україні в умовах міжнародної економічної інтеграції

Abstract

Problem setting. Importance of providing state aid to undertakings in Ukraine in compliance with international standards, as well as with the principles of transparency, efficiency, effectiveness, non-discrimination is growing due to the need to stimulate economic recovery, employment and promotion of economic activities with high value added. However, the government has not yet proposed a comprehensive approach to modify relevant schemes or measures in line with the country’s European integration commitments, based on the EU state aid rules. Legislative initiatives submitted in recent years (in particular, on support of industrial parks, on localization requirements in public procurement, on introduction of special tax regimes for certain sectors or territories, etc.), did not bring their proposed approaches to international standards, and were not finally accepted due to the relevant objections from Ukraine's international partners.Accordingly, the existence of standards of support to economic activity in countries or associations of countries with different levels of international economic integration and successful international experience in their implementation, as well as insufficient use of these standards for reforming state aid schemes and measures in Ukraine, justify the need for a holistic approach to improve state aid mechanisms.Recent research and publications analysis. Views of Ukrainian scientists regarding the development of state aid mechanisms can be structured by the following aspects:-                    international standards, first of all, EU rules, as a basis for modernization of public support in Ukraine;-                    improvement of the institutional mechanism;-                    improving the program and strategic dimension of state aid (support);-                    establishment of priority areas to be supported;-                    improving the quality of aid instruments (tax benefits, special economic zones, priority development areas, etc.).At the same time, a comprehensive approach to the further development of state aid mechanisms for economic entities has not yet been developed, which justifies the feasibility of formulating relevant proposals.The paper objective: to present a comprehensive approach of improving state aid to undertakings’ mechanisms, such as organizational; legal; mechanism of providing aid, its evaluation and adjustment; monitoring and control mechanism.The paper main body. The proposed approach is based on recommendations made by foreign researchers (D.Rodrik, J.Stiglitz, J.Felipe etc.) and international organisations (UNCTAD), as well as full use of the EU state aid rules. The following solutions are proposed to improve the relevant state aid mechanisms in Ukraine:1) Organisational mechanism should focus on setting priorities of public intervention and secure effective stakeholder participation. Such priorities can be based on theoretical background for state intervention, objectives of internal character, and objectives approved at the international level. It should also be able to make an early assessment, whether the proposed intervention falls under all state aid criteria (as prescribed by the EU law) or not. Effective stakeholder participation must be ensured by consolidating relevant advisory bodies affiliated with the Cabinet of Ministers of Ukraine.2) Legal mechanism should be improved by introducing a number of amendments into the current Law of Ukraine “On State Aid to Undertakings”, in order to make it fully compatible with the norms of the EU law and the EU-Ukraine Association Agreement.3) Mechanism of providing aid, its evaluation and adjustment should be developed using either all norms of the relevant EU state aid rules or main principles, on which these rules are based. Besides, indicators of effectiveness, efficiency and quality shall be introduced for aid evaluation an adjustment.4) Monitoring and control mechanism should focus foremost on the state aid impact on trade with the EU and competition, which is currently missing. Effectiveness of such monitoring and control will stem from the abovementioned amendments to the Ukrainian legislation.Besides the article emphasize the need to classify the actual and potential cases of state aid that meet the EU criteria and those, which do not meet such criteria (public support). The need of integrating the goals and objectives of state aid policy with sectoral policies, with the appropriate use of aid instruments that are recognized as legitimate in international practice, is also justified.Conclusions of the research. The application of an integrated approach to the modernization and development of state aid mechanisms for state aid in Ukraine is extremely important. First, all neighbour countries that are members of the EU (Poland, Czech Republic, Slovakia, and Romania) or have relations in the format of association, actively use various forms of state aid for undertakings. Delays in the introduction of modern forms of business support, either fully or partially based on EU state aid rules, or other best international practices (if support does not affect the state of trade with the EU) - will only worsen the competitive position of Ukrainian firms both domestically and in foreign markets. This, in turn, will not bring Ukraine closer to the EU membership criteria, which include economic competitiveness. Therefore, the implementation of the developed recommendations is justified both from the view of rationality (economic recovery after the crisis, promotion of competitiveness), legal provisions of the Constitution on the European integration course and international obligations, and from the view of support to Ukrainian small and medium business. Areas of further research include the implementation of the EU state aid rules to achieve objectives of the relevant areas of public policy: industrial, innovation, regional, small and medium business development and more.