Ukraine needs to focus on enhancing labor productivity, which should be a key growth factor, according to Anna Bjerde, the World Bank's Director of Operational Activities.
"We believe that increasing labor productivity will be a crucial factor for growth in the future, as it will enhance Ukraine's competitiveness," she stated at the conference "Matrix of Reforms: Foundations for Strengthening Economic Growth for EU Accession" held in Kyiv on Thursday, as reported by Interfax-Ukraine.
Bjerde emphasized that the government must pay close attention to new sources of growth and how to ensure the economy continues to expand, as a growing economy creates jobs.
In her view, Ukraine needs to capitalize on economic shifts and transformations, as well as changes in economic geography.
"Sectors that will be most important in the future are likely to differ significantly from those that have been very relevant over the last few decades. The skills required will also change. There may very well be a sense of friction between the old and the new as Ukraine begins to grapple with these growth factors in the future. There could be a mismatch of skills, as well as what we refer to as inefficient capital allocation. The question is whether capital is directed where it will yield the best returns or not," the World Bank Director emphasized.
According to her, Ukraine could gain significant advantages from integration into the EU, and access to the EU market will be crucial for attracting long-term investments into the country.
"Even today, Ukraine can start considering the implementation of the global value chain concept in business here. Access to global value chains and participation in them will be vital for Ukraine in the future," Bjerde pointed out.
She also highlighted the need to strengthen economic institutions along this path.
"It's not just about increasing accountability and transparency, but also about fostering meritocracy. This is largely connected to how your workforce and human capital evolve over time. We at the World Bank still believe that the biggest challenge for countries transitioning from middle-income to upper-middle-income status is the gap in institutional capacity, particularly in economic institutions," the World Bank Director noted.
She stressed the importance of Ukraine's commitment to innovation and digitalization.