DCAF DCAF a centre for security, development and the rule of law RAZUMKOV CENTRE THE GENEVA CENTRE FOR THE DEMOCRATIC CONTROL OF ARMED FORCES (DCAF) The Geneva Centre for the Democratic Control of Armed Forces (DCAF) is an international foundation whose mission is to assist the international community in pursuing good governance and reform of the security sector. To this end, the Centre MONITORING UKRAINE’S develops and promotes appropriate norms at the international and national levels, determines good practices and relevant policy recommendations for effective SECURITY GOVERNANCE CHALLENGES governance of the security sector, and provides in-country advisory support and practical assistance programmes to all interested actors. Detailed information is available at www.dcaf.ch Geneva Centre for the Democratic Control of Armed Forces (DCAF) Rue de Chantepoulet 11 PO Box 1360 CH-1211 Geneva 1 Switzerland Tel: + 41 22 741 77 00 Fax: + 41 22 741 77 05 E-mail: [email protected] RAZUMKOV CENTRE Razumkov Centre (Ukrainian Centre for Economic and Political Studies named after Olexander Razumkov) was established in 1994. It is a non-governmental, non-profit making think-tank that carries out its studies in the following areas: domestic policy; social and economic development of Ukraine; energy; economics; foreign policy; national security and defence; international and regional security. Razumkov Centre employs 35 people working on a permanent basis, and contracts more than 100 experts annually for different projects. It also has its own Sociological Service. Razumkov Centre cooperates with the Ukrainian governmental agencies, international organisations and embassies, think-tanks, NGOs and media. PROCEEDINGS FROM THE SIXTH INTERNATIONAL CONFERENCE 6 Detailed information is available at www.razumkov.org.ua “SECURITY SECTOR GOVERNANCE: Ukrainian Centre for Economic & Political Studies named after Olexander Razumkov DEFENCE PRODUCTION, SALES AND ACQUISITIONS” Vul. Lavrska, 16 Kyiv, Ukraine, 01015 1-2 February 2017, Kyiv, Ukraine Tel.: +380 44 201 11 98 Fax: +380 44 201 11 99 E-mail: [email protected] КYIV-2017 CONFERENCE DCAF DCAF a centre for security, development and the rule of law RAZUMKOV CENTRE MONITORING UKRAINE’S SECURITY GOVERNANCE CHALLENGES Proceedings from the Sixth International Conference “Security Sector Governance: Defence Production, Sales and Acquisitions” 1-2 February 2017, Kyiv, Ukraine KYIV – 2017 Editors: Philipp H. Fluri, Oleksiy Melnyk, Nazli Yildirim Co-editors: Eden Cole, Claudia Miccichè Copy Editors: Richard Steyne, Valeriya Klymenko Design and Layout: Tetyana Ovsyanyk, Oleksandr Shaptala This publication offers the proceedings of the Sixth International Conference “Security Sector Governance: Defence Production, Sales and Acquisitions”. Conference Six provided a platform to discuss state policy and the market economy; governance and oversight of the defence sector; and defence industrial cooperation with foreign countries. In addition to identification of the reform challenges and priorities, one of the main objectives was to propose solutions based on lessons learned and international best practices relevant to Ukrainian realities. General assessments, conclusions and proposals are those of the participants and do not necessarily coincide with the positions of DCAF, the Razumkov Centre or the official position of the Ministry of Foreign Affairs of the Netherlands. Publication was made possible in the framework of the joint DCAF-Razumkov Centre Project “Monitoring Ukraine’s Security Governance Challenges” sponsored by the Ministry of Foreign Affairs of the Netherlands. © DCAF, 2017 © Razumkov Centre, 2017 © “Zapovit” Publishing House, 2017 CONTENTS INTRODUCTION ...........................................................................................................5 OPENING REMARKS ....................................................................................................6 Philipp FLURI ........................................................................................................... 6 MAIN TASKS OF THE SYSTEM OF MANAGEMENT IN THE FIELD OF PRODUCTION, MARKETING AND PROCUREMENT OF DEFENCE PRODUCTS Oleh HLADKOVSKYI.................................................................................................. 7 CONCEPT OF REFORMATION AND DEVELOPMENT OF UKRAINE’S DEFENCE INDUSTRY (CONCEPT OF STATE TARGET PROGRAMME 2021) Yuriy BROVCHENKO ............................................................................................... 11 ENHANCEMENT OF UKRAINE’S ECONOMIC POTENTIAL THROUGH TRANSFORMATION OF THE SECURITY AND DEFENCE SECTOR Vitaliy BEHMA ........................................................................................................ 15 COOPERATION BETWEEN PRIVATE ENTERPRISES Oleh VYSOTSKYI .................................................................................................... 19 PROBLEMS OF BUILDING PUBLIC-PRIVATE PARTNERSHIP AND WAYS OF THEIR SOLUTION Artem VYUNNYK .................................................................................................... 21 DEFENCE-INDUSTRIAL COOPERATION WITH FOREIGN COUNTRIES: BEST PRACTICES OF ETHICS Todor TAGAREV ...................................................................................................... 23 ROLE, POWERS AND PRACTICES OF PARLIAMENTARY OVERSIGHT OF DEFENCE PRODUCTION, SALES AND PROCUREMENT – INTERNATIONAL BEST PRACTICES Todor TAGAREV ...................................................................................................... 27 BAD EXPERIENCE OF PARLIAMENTARY CONTROL OF PERFECTION OF THE DEFENCE INDUSTRY COMPLEX GOVERNANCE Heorhii KRYUCHKOV .............................................................................................. 31 NEEDS AND PROBLEMS OF REFORMATION OF THE SYSTEM OF UKRAINE’S DEFENCE INDUSTRY MANAGEMENT Oleksiy SKRYPNYK ................................................................................................. 33 SECURITY AND DEFENCE SECTOR GOVERNANCE: PRODUCTION, SALE AND PROCUREMENT OF WEAPONS Denys HURAK ......................................................................................................... 35 PROCESSES NEED TO BE FORMALISED Mark OPGENORTH ................................................................................................. 43 DEFENCE PRODUCTION, SALES AND PROCUREMENT – NGO OVERSIGHT Eva ANDERSON ...................................................................................................... 46 INEFFECTIVE MANAGEMENT AND EXCESSIVE SECRECY Viktor PLAKHUTA ................................................................................................... 49 PROBLEMS OF UKRAINE’S DEFENCE INDUSTRY REFORM Mykola SUNHUROVSKYI ........................................................................................ 52 PROBLEMS AND WAYS OF IMPROVEMENT OF MANAGEMENT IN THE FIELD OF PROCUREMENT, EXPORT/IMPORT WEAPONS AND MILITARY EQUIPMENT IN UKRAINE Valentyn BADRAK ................................................................................................... 63 REGULATION OF EXPORT/IMPORT OF ARMS AND MILITARY EQUIPMENT IN UKRAINE Valentyn BADRAK ................................................................................................... 76 MILITARY-TECHNOLOGICAL COOPERATION OF UKRAINE WITH NATO AND THE EU Ihor PAVLOVSKYI ................................................................................................... 81 DEFENCE-INDUSTRIAL COOPERATION WITH NATO COUNTRIES Edward HUNTER CHRISTIE ..................................................................................... 85 DEFENCE PRODUCTION, SALES AND PROCUREMENT: INTERNATIONAL BEST PRACTICES Adrian KENDRY ...................................................................................................... 88 DEFENCE PRODUCTION, SALES AND PROCUREMENT: US MARKET James GREENE ....................................................................................................... 91 INTRODUCTION he ‘Monitoring Ukraine’s Security Governance Challenges’ programme funded by T the Kingdom of the Netherlands and implemented by the Geneva Centre for the Democratic Control of Armed Forces (DCAF) and the Razumkov Centre jointly to which this publication owes its existence aims at raising public awareness and wide discussion and communication on democratic oversight and good practices in the management of the security sector of Ukraine. The programme’s objective is to facilitate a public discourse on and public access to Ukrainian and international best practices in security governance while making pertinent information in both the Ukrainian and English languages available in printed publications, a dedicated website www.ukrainesecuritysector.com, and through Mass Media coverage of public events. Two opinion polls are designed to establish whether and to what degree democratic governance of the security sector is understood, and implemented. The 6th Conference attended by many concerned parties discussed current problems and prospects of improvement of the military-technological policy and management of Ukraine’s defence industry. The main subjects of discussion included the state and prospects of development of the defence industry, challenges of introduction of good governance in the field of development, production, marketing and procurement of arms and military equipment, public-private partnership and military-technological cooperation with foreign partners, parliamentary supervision of the defence industry complex. Domestic and international experts,