Regional Development Agencies, or RDAs for short, in Ukraine are gradually acquiring the characteristics of an effective tool for the implementation of regional policy and play an important role in supporting the development of regions. However, there are still many myths and misunderstandings surrounding their activities. So, in this material, we aim to dispel some of the misconceptions and share real examples of how RDAs become really important players in the development process of Ukrainian regions, contributing to their economic, social and innovative growth.
The material was prepared by the team of the Swiss-Ukrainian project “Ukraine’s Cohesion and Regional Development”, UCORD, which is implemented with the support of Switzerland by NIRAS Sweden AB. The purpose of the UCORD project is to promote coordinated actions for recovery and coordinated regional development on the part of citizens, businesses and authorities, which in turn improves the quality of life of people, strengthens the stability of society, peace and social cohesion in Ukraine.
Myth 1: the status of the RDA remains legally undefined
Until 2015, it was possible to say that public organizations that managed the development projects of their community or region could be called Regional Development Agencies. Actually, some of these organizations still exist and are even successful in projects of support the development of their communities and/or regions. Nevertheless, they have completely different status, functionality and powers.
Precisely since 2015, thanks to the adoption of the Law of Ukraine “On the Principles of State Regional Policy” No. 156-VIII (hereinafter – the Law) and the corresponding Model Regulations on the Regional Development Agency, the tasks and functions of the Agencies, the order of operations, the organizational structure, the management bodies of the Regional Development Agency were regulated , issues of financial and logistical support.
Accordingly, the status and absolutely all activities of Regional Development Agencies are clearly regulated. Regional Development Agencies in Ukraine are created in accordance with the Law and are governed by it in their relations with the founders – regional councils and administrations, co-founders and partners. The law clearly stipulates that only one RDA can be created in each region. More about RDA in Ukraine – in the infographic from the UCORD project.
Myth 2: RDAs are weak institutions that do not know how to do anything
Regional Development Agencies in Ukraine are constantly developing and differ among themselves in terms of projects and directions of regional development support, depending on the needs and priorities of their region. For example, RDA of Odesa Oblast, among a large set of successful initiatives in various fields, supports the development of international transport corridors and ports, while RDA of Kyiv Oblast focuses on using the existing economic and logistics potential of the region to attract wider investments.
Nevertheless, all RDAs share a specific list of functions defined by the Law, in particular:
- part in regional strategizing and planning. Even during full-scale war, Agencies continue to support the recovery and comprehensive development of their areas. For example, the same Odesa Oblast Agency is a platform for coordinating the development of the new Odesa Oblast Development Strategy, which takes place with the active participation of numerous interested parties and partners.
- support of communities in their region. For example, the RDA of Khmelnytska Oblast helps in the preparation of strategies for the development of territorial communities, and the RDA of Sumy Oblast also provided an expert assessment of the community development strategies of its region for compliance with the regional strategy.
- business support in the region. Ensuring comprehensive economic and social development requires the involvement of both the government and the private sector. It is their joint efforts that turn large-scale infrastructure projects into reality. For example, the Ternopil Regional Development Agency is developing a network of industrial parks for the sake of economic and industrial growth and expansion of investment opportunities in its region.
RDAs support and consult medium, small and micro businesses that are just beginning to develop or have been relocated from the frontline areas. As a matter of fact, most of the RDAs conduct trainings and consultations for entrepreneurs – for example, the RDA of the Vinnytsia Oblast covered more than 2,000 people with business services. people., and the RDA of Luhansk region conducts training for entrepreneurs displaced from Luhansk region, despite their own forced relocation and the almost complete capture of the territory by the enemy. - attraction of investors and funds from European funds, which become available for Ukraine as a result of obtaining the status of a candidate for EU accession. For example, the Regional Administrative Agency of Zakarpattia, Lviv, Ivano-Frankivsk, Rivne, and Volyn regions have already formed a partnership for synergy in the development of interregional and cross-border projects of the Interreg, Connecting Europe Facility, Digital Europe, EU4Health programs. The Ternopil Regional Development Agency is already involved in the activities within the Interreg NEXT cross-border cooperation program “Poland – Ukraine 20212027”.
At the same time, the RDA of Chernivtsi Oblast ensures a multilateral international and national dialogue regarding investments in Bukovyna, and the RDA of Cherkasy Oblast takes a comprehensive approach to supporting business and expanding the investment attractiveness of the region through direct partnerships with Chambers of Commerce of various countries. - cooperation with scientific institutions. For example, the RDA of the Volyn region is the initiator of the creation of a cluster of medical innovations, which united numerous partners and, first of all, scientific institutions and medical universities; the RDA of Sumy Oblast engages regional universities in particular to strengthen the research component of projects, for example, in the field of health care, and the RDA of Zaporizhia Oblast engages scientists in educational activities through online discussions about the importance of press freedom.
- work with youth. Working with their co-founder universities, regional development agencies are a unique bridge between the technological and creative potential of youth and the regional labor market. For example, the Regional Development Agency of Zhytomyr Oblast works comprehensively with students so that innovations – STEM disciplines, AI technologies, and others – become an indispensable component of the oblast’s development. At the same time, the RDA of Chernihiv region is conducting a project to teach the basics of business for the youth of its region.
- humanitarian projects. RDAs are able to quickly respond to crises, using their experience in the development of regions, therefore they become indispensable coordinators of humanitarian initiatives. For example, the RDA of Mykolaiv Oblast proactively supports the reconstruction of the region and provides assistance to displaced persons and residents of Mykolaiv Oblast, which suffers from frequent shelling and destruction. In the same way, the RDA of the Kherson region manages to combine long-term strategizing regarding the development of its region with the provision of urgent humanitarian aid to the population of the de-occupied territories.
- support of social cohesion, development of identity and culture. These very important areas of activity are organically integrated into the everyday life of every Ukrainian and strengthen state policies for recovery and development. For example, the RDA of Poltava Oblast supports veterans by advising them on the preparation of grant applications, and the pilot agencies of the UCORD project co-organize a series of forums to promote the development of cultural policy, multilateral dialogue and strengthening social cohesion.
No matter how big this list may seem, there is a point of intersection of all areas of activity of Regional Development Agencies in Ukraine – this is a strategic view of the development of their region, which the agencies have thanks to the mandate received from the state.
Regional Development Agencies continue to develop as institutions: they still face the challenges of insufficient funding, a lack of qualified staff, sometimes imperfect internal structures, and incomplete understanding of the agencies by their partners and stakeholders. The Swiss-Ukrainian UCORD project is engaged in promoting the development of regional development and supporting comprehensive regional policy in Ukraine. It focuses on the transformation of the organizational structures of the RDAs in Ukraine, as well as building their capacities in order to establish their role as leaders and facilitators of recovery, capable of determining regional priorities and forming partnerships for the development and implementation of projects that fully realize the potential of the regions.
Myth 3: Regional administrations can perform what the RDAs do
In fact, the functions of Regional Development Agencies and regional administrations in Ukraine differ significantly due to the different roles and organizational and legal statuses of these institutions.
RDAs were created as non-profit institutions based on partnerships between the public, private and public sectors, as well as scientific and educational institutions. Their main goal is to promote the effective implementation of regional policy through the development and execution of regional development projects, attracting investments and stimulating cooperation between various sectors in the region.
In contrast, regional administrations are part of the state executive power, which is responsible for the implementation of state policy in the region. Their functions include monitoring compliance with the law, ensuring security and order, and coordinating the activities of various authorities. Regional administrations act as a tool of vertical management aimed at implementing the decisions of the central government in the regions.
Regional Development Agencies also differ from regional administrations in more flexible structure and ability to quickly adapt to changes in the environment, working on specific projects and attracting various sources of funding. They act as a catalyst for development, not a tool of administration, which makes them unique within the framework of Ukraine’s regional policy.
In EU member states and other countries of the world, Regional Development Agencies are one of the tools of institutional support for regional development – they complement the traditional tools and financial incentives of central governments aimed at strengthening the local sector of the economy. In particular, in Western Europe, RDAs play an important role in the formation and development of regional policy “from the bottom up”, and also perform the function of “mediator” between local and regional communities, entrepreneurs, civil society institutions and the strategic intentions of the executive power and local self-government at various levels regarding the socio-economic development of the territory.
In this context, Regional Development Agencies in Ukraine continue to develop and shape their identity. Follow the news of the Regional Policy section on the Decentralization portal to stay abreast of innovations, challenges and solutions in Ukraine’s regional policy.
Myth 4: RDAs are ordinary project offices
Although both project offices and Regional Development Agencies contribute to the development of their regions, they do so in different ways. Both the first and the second are engaged in development projects, however, the RDAs go beyond the exclusively project approach and are strategic players.
Project offices usually focus on the management and implementation of specific projects with a limited scope and duration, while Regional Development Agencies have a broader, long-term mandate aimed at the overall development of the region. RDAs functions go beyond project management; they are platforms for establishing partnerships and mediators, facilitate strategizing and planning for the recovery and development of the region, promote innovation, attract investments, support entrepreneurship, promote social and economic development, and in general are a tool for the implementation of state regional policy.
Regional Development Agencies act more strategically, involving a wider range of stakeholders and more formats and activities, while project offices are more tactical and focused on the implementation of specific initiatives.
Myth 5: RDAs are not modern and sophisticated
Let’s start with the fact that, in fact, the RDA as an institution is an innovation for Ukraine. Although the term and the formation of the Regional Development Agency in Ukraine dates back to the 2000s, it took another 15 years to realize the role and importance of this instrument of state regional policy and to establish their status and functioning procedure by law. That is, right now we are watching how Agencies acquire new opportunities for self-actualization and, in fact, the fulfillment of their purpose.
In this context, the self-actualization of Ukrainian RDAs show the state’s desire for innovative approaches in solving issues of regional development. After all, Agencies are created as flexible and dynamic structures that can adapt to changing market conditions, attract international and national investments, as well as actively cooperate with local communities and businesses to achieve common strategic goals of regional development.
Therefore, within the framework of the implementation of the state regional policy, the RDAs can also take care of such an innovation as smart specialization. It is one of the key tools of the modern regional policy of the European Union. Smart specialization allows regions to focus on their unique capabilities and competitive advantages, developing those sectors of the economy that have the greatest potential for growth. In this way, the RDAs not only contribute to the development of the economy, but also actively work to increase the competitiveness of the regions, integrating them into global economic processes.
In addition, RDAs contribute to the formation and development of clusters in Ukraine. According to the definition of the European Commission, clusters are groups of interconnected economic entities, enterprises and institutions that are located in close proximity and have a sufficient scale to develop specialized expertise, services, resources, suppliers and skills. RDAs help to unite such partners in development, creating conditions for cooperation, exchange of experience and innovation. Through the support of clusters, the RDPs contribute to the increase of productivity and competitiveness of the local economy, which is an important element of modern economic development.
Thus, the RDAs in Ukraine are not only not a complicated structures, but also play a key role in the implementation of modern approaches to regional development, which corresponds to world trends and standards.
We see that Regional Development Agencies in Ukraine have significant potential for development, but face challenges related to funding, personnel and internal organization. So ahead is a transformation process that will allow them to strengthen their role in regional development, including with the help of international partners.
The first such partner is the Swiss-Ukrainian project “Ukraine’s Cohesion and Regional Development”, UCORD is the only project in Ukraine that provides comprehensive support to the ADR in six pilot areas . The UCORD project focuses on the transformation of the organizational structures of Regional Development Agencies in Ukraine, as well as building their capacities in order to establish their role as leaders and facilitators of recovery, capable of determining regional priorities and forming partnerships for the development and implementation of projects that fully reveal the potential of regions.