Introduction to the Defense Industry of Public Administration: While out of the Field of View of the Leadership of Ukraine

At the beginning of August, we published some results of the analysis of the state of affairs in the sphere of reforming the national military-industrial complex (MIC) and recommendations for the introduction of proper support for the formation and implementation of the state military-industrial policy (SMIP), as well as management of the enterprises, institutions and organizations of industry and science that are part of this complex (hereinafter – subjects of MIC) [1].
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However, in the three months since then, a number of important events have taken place that encourage further discussion around these recommendations.

First of all, while we, as well as the ex-Secretary of the National Investment Council and ex-member of the Supervisory Board of the State Concern (GC) “Ukroboronprom” D. G. Arakhamiya and a member of the Board of the Ukrainian Institute of Security research V. Badrak considered it appropriate to recommend to the leadership of Ukraine to form a new profile Ministry (of Industrial and Military-Industrial Policy) to perform the following main tasks: ensuring the formation and implementation of SMIP; determining priority areas for the development of the defense industry; ensuring normative-legal regulation in this area; analyzing the state and trends in the development of the Defense industry, State management of its subjects; developing and organizing the implementation of State programs for the development of the Defense industry, etc. [1], [2].

As a last resort, it was recommended to form an Agency, for example, of the Defense Industry. However, his activities would be directed and coordinated directly by the Cabinet of Ministers of Ukraine by analogy (at the time) with the State Space Agency of Ukraine or the Cabinet would implement it through a specific Minister.

As of today, taking into account a number of the following events, the recommendation on education for managing the defense industry entities of the new profile Ministry (of Industrial or Military-Industrial Policy) is no longer relevant.

After all, on August 29, the Verkhovna Rada of Ukraine approved a new, significantly reduced Cabinet of Ministers of Ukraine. Compared to the previous Government, there are only 2 (not 6) Deputy Prime Ministers and 14 (not 19) Ministers who Head the Ministries. In addition, this Cabinet, in particular, introduced the post of Minister of Economic Development, Trade and Agriculture of Ukraine instead of the eliminated positions of Minister of Economic Development and Trade of Ukraine and Minister of Agrarian Policy and Food of Ukraine.

On August 30 of this year, the President of Ukraine appointed A. Abromavicius as the General Director of Ukroboronprom [3], who thus received a carte Blanche from the Head of State to implement the plans he had previously published in the media to reform this main subject of the Defense industry. This is a very important issue that should be discussed separately and carefully.

The Cabinet of Ministers of Ukraine (CMU) on September 2 of this year, in order to optimize the system of Central Executive Authorities, among other things, renamed the Ministry of Economic Development and Trade on the Ministry of Economic Development, Trade and Agriculture of Ukraine (Ministry of Economy) [4], to which it joined, after reorganization, the former Ministry of Agrarian Policy and Food of Ukraine.

Based on this decision of the Government, a number of relevant changes were made to the regulations on the Ministry of Economy. But at the same time, its powers and main tasks in the field of Defense remained in the previous versions [5].

Recall that according to this provision, the Ministry of Economy, in particular:

  • is the main body in the system of Central Executive Authorities that ensures forming and implements military-industrial policy, the State policy in the sphere of technical regulation, standardization, metrology and metrological activity, State policy in the sphere of state ownership objects management, including corporate rights of the state, public-private partnerships, intellectual property, state and public procurement and State order on training of specialists, scientific, scientific-pedagogical and personnel, advanced training and retraining;
  • ensures the formation and implementation of the state export control policy;
  • it is the authorized body for coordinating the implementation of the state defense order.
  • prepares and summarizes proposals for the formation and implementation of state policy in the field of functioning and development of the Defense industry, the development of scientific and technical potential in the field of weapons and military equipment, improving the mechanism of state regulation in this area;
  • determines together with other bodies of the security sector and defense priorities for the development of the defense industry, provides legal regulation in this sphere, analyzes the status and trends of development of the Defense industry, develops and organizes the implementation of State programs of the Defense industry development;
  • ensures coordination of activities carried out by Central and Local Executive Authorities in the field of functioning and development of the Defense industry;
  • performs a review of the Defense industry, develops a strategy for the development of the Defense industry of Ukraine;
  • forms and submits a draft of the State Defense order to the Cabinet of Ministers, coordinates activities for the implementation of the State Defense order;
  • together with the Ministry of Defense: organizes and coordinates the activities of the Central Executive Authorities in the field of military-technical cooperation; submits to the Cabinet of Ministers the draft laws, international agreements of Ukraine, and other normative legal acts in the field of military-technical cooperation;
  • ensures the establishment of state control over the implementation of activities related to international transfers of military and dual-use goods.