Final Documentation

BDS in Transition Economies: The case of Ukraine, USAID 2001

    Description
    The presentation uses a case study - USAID's NewBizNet program in Ukraine - to answer several key questions about BDS in transition economies...
    * Does it make sense to use a market development approach?
    * Are there minimum environmental conditions?
    * Does environment affect the choice of interventions?
    * Should interventions be sequenced differently?
    * Should provider / facilitator roles be viewed differently?

    In the existing BDS market most providers were supported by donor investments and demand for services was weak. Initial donor strategies focused on provider viability, but outcomes were mixed and products often did not match needs. NewBizNet modified its approach to strengthen demand signals for services that SMEs could use to solve problems and to promote competition amongst providers, and used work orders and vouchers to strengthen market signals between SMEs & providers.

    Summary of results
    Although the key question - does it makes sense to use a market development approach? - remains unanswered, it is clear that program goals are the same, but strategies for reaching them differ. The over-regulated environment in Ukraine suggested that a focus on developing viable products demanded by SMEs would result in self-sufficiency for providers.