Ukraine reached a historic high in Transparency International annual Corruption Perceptions Index (CPI) in 2023, improving its score by three points to reach 36 out of a possible 100, according to the report released on January 30.

Ukraine has risen from 116 place to 104 place from a total of 180 countries, continuing a decade of improvements in the rankings and putting it on a par with the other EU candidate countries Moldova and Georgia, amongst others.

Transparency International's executive director Andriy Borovyk commented: "Ukraine has demonstrated a good result this year and progressive dynamics over 10 years. We have developed an anti-corruption ecosystem from scratch and have real sentences for high-profile corruption cases, yet there is significant work ahead to reach the level of EU countries."

The index assigns rankings on a scale from 0 (“highly corrupt”) to 100 (“very clean”) for 180 countries and territories.

Ukraine’s gains come in the midst of the war with Russia. However, in parallel Ukraine has been accepted as a candidate country for EU membership in December that has provided the impetus to make deep structural reforms that have anti-graft measures at their heart.

The EU-driven reforms are well underway and focus on the justice system, including restructuring judicial self-governance bodies and increasing judicial independence, as a key element.

Efforts to strengthen the capacity and independence of its anti-corruption agency (NABU) and its anti-corruption prosecution body (SAPO) – coupled with Ukrainian President Volodymyr Zelenskiy’s national anti-corruption strategy and its comprehensive implementation programme – have already delivered results.

Crushing corruption will also be key to bringing in post-war investment. At Ukraine’s Reconstruction conference held in London in July 2022, the West appealed to the private sector to provide the hundreds of billions of dollars needed to rebuild the country after the war, and that can only happen if Ukraine can present a reliable and rule of law-based system where corruption has been eradicated.

Corruption scandal

The upbeat assessment of the perceived corruption in Ukraine falling comes as the actual corruption remains very apparent. Despite the progress, Ukraine still has a bad corruption problem that is deeply rooted and has plagued the country since independence, as bne IntelliNews explored in a recent opinion piece looking at the twin trends of democratisation and corruption.

In September last year Zelenskiy was forced to sack his Defence Minister Oleksii Reznikov, who was tainted by multiple corruption scandals during his tenure.

Then last weekend the government was rocked by a fresh scandal at the Defence Ministry, where senior unnamed Defence Ministry officials and top managers at a leading arms manufacturer were busted by the Ukrainian Security Service (SBU) for running a UAH1.5bn ($40mn) scam to procure artillery shells that were never delivered. Five suspects have been issued with “suspicion of wrongdoing notice” and one was arrested trying to flee the country.

At the same time, Transparency International warned in its report that the country’s improving standing was endangered by recent pressures on the press by the state bodies.

Ukraine's three-point growth is one of the best improvements worldwide over the past year, positioning it among 17 countries that showed their best-ever performance in the current CPI. However, the basis of the poll only records polled perceptions of corruption and metrics that provide measures of proxies for actual corruption, as the “net errors and omissions” in national accounts that are often used as a proxy for capital flight.

Tellingly, three US inspector generals arrived in Kyiv the day before the release of the index to audit the money and weapons that have been sent to Ukraine over the last two years, due to growing concerns in Washington about the accountability for the aid that has been sent to Ukraine. Zelenskiy’s administration is well aware of these worries and has introduced a better system of recording and tracking these deliveries.

Anti-corruption drive 

The study reveals that Ukraine shares its CPI score with Algeria, Brazil and Serbia. It trails by a single point behind countries such as Albania, Argentina, Belarus, Gambia, Ethiopia and Zambia.

At the forefront of the 2023 Corruption Perceptions Index are Denmark, Finland, New Zealand and Norway, with scores ranging from 84 to 90 points. Conversely, the index's bottom ranks include Somalia, South Sudan, Syria and Venezuela.

The United States only came in 24th with a score of 69 – a slight increase on 2021's score, which was the country's lowest since 2012 – and remains the same as that given in 2022. Transparency International cites "weak ethics rules for the US Supreme Court" which have "raised serious questions of judicial integrity" in the country. It notes, however, that despite this, US federal and state judiciaries "largely" continue to have sufficient independence.

However, the persistence of high-level corruption cases in Ukraine remains a serious problem that undermines the country’s otherwise positive image amongst investors.

Zelenskiy has been trying to counter these problems and the number of low-level arrests of officials and the high-level arrest of oligarch Ihor Kolomoisky on September 2 highlight that Bankova is taking the problem seriously.

Recently the Defence Ministry has begun to inspect enlistment offices, food warehouses and other state facilities, and has uncovered many violations. According to Defence Minister Rustem Umerov, the Defence Ministry aims to fix all the drawbacks systematically and is cooperating with the SBU, which is under the direct control of the president’s office, the State Bureau of Investigation and the Prosecutor General’s Office to crack down on corruption.

The World Bank has pointed to Ukraine’s electronic asset declaration system that forces public servants to declare their wealth each year as a positive development. The declarations were suspended after the start of the war with Russia but have just been reintroduced and Zelenskiy himself filed a declaration of an income of just over $400,000, seven apartments and two cars.

However, when the Rada proposed amendments to the law that would have provided widespread exemptions Zelenskiy vetoed the bill in September, insisting that full declarations should be resumed this year, with the one exception for those in active military service. His changes were accepted, and a revised bill was passed shortly afterwards.

Deputy Minister of Economy Oleksiy Sobolev acknowledged the progress on Facebook, but said more needs to be done, setting an ambitious ten-year target to further improve Ukraine's CPI score by another 11 points.

"To be a global leader in the fight against corruption over the past decade, we would need to add another 5 points, like Uzbekistan, bringing us to 41 points, on par with Kosovo, South Africa or Vietnam," Sobolev stated, advocating for reasonable and realistic expectations.

0124 GLOBAL Transparency International 2023 Corruption Perceptions Index CPI