VOCATIONAL EDUCATION AND TRAINING IN UKRAINE

The project comprises two components that will seek the modernisation of the Ukrainian Vocational Education and Training (VET) system. The first component is the EU4Skills programme funded by the European Commission, Germany, Poland and Finland with additional participation by Estonia. The second component is the EIB's financed operation. The EIB operation comprises the establishment of one Centre of Excellence (CoE) in Vocational Education and Training in up to 10 selected administrative regions (oblasts) in Ukraine. The EU4Skills Programme will comprise the establishment of a further 3 CoEs as well as the implementation of capacity building and smaller school upgrading measures.

The EIB aims to support the Ukrainian government in ongoing reform of the VET sector through construction or substantial renovation and upgrade of existing VET schools and turning them into Centres of Excellence in up to 10 regions in Ukraine. The loan is supposed to complement the EU4Skills: Better Skills for Modern Ukraine programme launched by the European Commission in 2019, co-funded by Germany, Finland, Poland and Estonia and targeted to support with reforms and modernisation of the VET system in Ukraine.

The project addresses a sub-optimal investment situation in vocational education and training governance and infrastructure in Ukraine. The project will create several centres of excellence throughout the country in line with the on-going reform in vocational education sector in Ukraine. The project is expected to improve the quality, attractiveness and relevance of vocational education in the country, which in turn is expected to increase economic growth and improve career opportunities for Ukrainian youth. The financial contribution of the EIB is excellent due to Ukraine's limited current capacity to mobilize funding for these investments at similar terms and due to the flexible and favorable conditions passed on with the EIB's loan. Finally, the project benefits from the strong sectoral expertise and advice delivered by the Bank's team during project preparation and appraisal, which will be followed up by more technical assistance funded by the European Commission via the Neighbourhood Investment Facility.

The Republic of Ukraine signed an Association Agreement with the EU in 2014. As part of that agreement, Ukraine committed to transposing the environmental impact assessment (EIA) Directive 2014/52/EU amending directive 2011/92/EU into its legislation. In 2017, Ukraine passed legislation updating its current legislation that broadly transposes Directive 2014/52/EU and 2011/92/EU bringing the country's EIA legislation in line with EU law. The principles of the 2017 legislation would satisfy the EIB's Environmental and Social Safeguards. The project is expected to be located where existing VET schools and education infrastructure exist. Therefore, potential negative environmental and social impacts are likely to be minor. If situated in the EU, the project would likely fall within Annex II of Directive 2014/52/EU amending Directive 2011/92/EU and therefore be subject to screening. However, formal screening does not exist in Ukraine and the responsibility lies with the developer using professionally competent people to assess the environmental impacts against the legislation. Such an assessment must be carried out prior to providing development consent as the authority issuing the development consent checks it. The potential impact on any conservation areas will also need to be appraised. The compliance of the procedures in place with the EIB Environmental and Social Standards will be analysed during the appraisal. Although Ukraine has not yet transposed Directive 2010/31/EU on the performance of energy in buildings, it has passed legislation on energy efficiency in buildings. The new buildings will be designed and built to conform to Directive 2010/31/EU.

The Bank will require the Promoter to ensure that any procurement procedures are done in accordance with the Bank's Guide to Procurement and the relevant applicable EU public procurement rules.

This operation is covered by the ELM Guarantee.