SCEEUS Report No 12
Executive Summary
Local authorities are fundamental to Ukraine’s political landscape and crucial for the implementation of reforms. EU accession could easily become a national project, however, which might lead European partners to overlook local challenges and specific needs.
Three key local issues for Ukraine’s EU integration are unbalanced resource distribution, difficult environmental priorities, and the pressures on local governance under martial law.
European support for reform could be more participatory and better adapted to local needs. This would require improved local communication and presence, working methods that empower local actors, inclusive and flexible financing, and clearer identification of priorities in challenging policy areas.
Introduction
Given that around 70 per cent of EU legislation requires action at the subnational level, the political will in regions and local communities to implement reforms and pursue the path of European integration is fundamental to a candidate country’s EU accession. The importance of subnational action is evident in Ukraine, a large country with multiple levels of governance, from regions (oblasts) to local communities (hromadas) and cities, as well as a vibrant and influential civil society. Research shows higher levels of trust in local government than in central government in Ukraine, adding to the importance of local authorities when fostering long-term societal support for the European path.
Nonetheless, EU accession could easily become a national project. High-profile national reforms dominate media coverage, reform plans often focus on state-level institutions, and international technical assistance programmes often target ministries in the capital. Consideration of regional and local perspectives will be crucial to provide a balanced view of support for the reforms needed to facilitate Ukraine’s EU integration. This discussion highlights three key areas: resource distribution, environmental priorities and local governance.
Resource distribution
The prolonged war is pushing more of Ukraine’s economic activity towards the west of the country. Government figures indicate that tax revenues in Ukraine’s western regions have increased by more than 20 per cent. This is due, in particular, to the movement of internally displaced persons (IDPs) and businesses from regions under temporary occupation or where there are active hostilities. International businesses and investors have also turned their attention to Ukraine’s western regions, as some donors restrict recovery efforts and projects to regions with easier connectivity and lower risk.
Economic investment and international projects in western Ukraine have added to the national budget and provided opportunities for local citizens. At the same time, however, the movement of capital has increased the costs of living. For example, the average residential price per square metre has increased by more than 20 per cent in Ivano-Frankivsk and Zakarpattia. In the city of Lviv, real estate prices have more than doubled. The shortage of affordable rented housing is particularly acute, sometimes forcing IDPs to move back to less secure areas.
The economic trends also risk generating greater socio-economic disparities and urban-rural divides within the country, putting strain on social cohesion and the government’s ability to portray EU integration as a whole-of-society project. For example, local communities with large urban centres and leaders able to maintain personal links abroad are better positioned to establish partnerships that deliver financial and practical support. In contrast, rural hromadas, especially in eastern and south-eastern parts of the country, face more obstacles to establishing international partnerships. Many of these hromadas have been severely impacted by the war and lack the resources to maintain the normal functioning of their communities, risking further depopulation and economic decline.
The ability to tap into the opportunities and resources offered by international support for reform is also dependent on human capital and economic leverage. Communities and city councils need skilled staff and adequate language skills to make successful project applications to international partners. If payments are delivered gradually or in tranches, local administrations need sufficient capital readily available for initial project implementation. The Ukrainian state budget does not currently provide loans to fund such expenses.
Moreover, in contrast to several EU member states, Ukrainian legislation does not allow local government officials to receive additional remuneration from internationally funded projects. Consequently, municipalities may need to hire external experts, which requires resources and limits the development of internal institutional capacity at the local level. A draft bill that aims to regulate this through an amendment to the Ukrainian Labour Code has passed its first reading in Ukraine’s Parliament (Verkhovna Rada) but has not progressed further.
Taken together, this means that European reform support projects, while established for good reasons, can end up being exclusive or adding to the unbalanced resource distribution between different regions and localities. Inequality strains social cohesion in the country as a whole and risks weakening trust in public authorities, which is essential for resilience and effective governance.
Environmental priorities
Reconstruction presents a chance for Ukraine to adopt clean technologies, elevate energy efficiency, and develop resilient infrastructure. Such a green transition would enhance the energy autonomy, food security and competitiveness of Ukraine and the EU. It is also part of the formal requirements for becoming a full EU member state. However, implementing the EU’s detailed and sometimes changing climate regulations requires time, human capital and material resources, and priorities might differ at the central and local levels of governance.
In the summer of 2025, Ukraine’s Ministry of Environment and Natural Resources was merged with the Ministry of Agrarian Policy and the Ministry of Economy. Some voiced concerns that the merger indicated that the central authorities place a lower priority on environmental issues. Others argued that it facilitates a more comprehensive and systematic approach to the issues. Regardless, it resulted in the loss of most of the public officials who had been working on the environment and the green transition in the EU accession process, thereby reducing the administrative capacity to implement reforms in this area.
The damage to the environment as a consequence of Russia’s war is more evident in Ukraine’s regions and localities. Land has been contaminated, forests mined, rivers polluted, and monitoring and control infrastructure destroyed. Agriculture was severely affected by the destruction of the Kakhovka Dam in 2023. The initial flooding destroyed crops and the long-term impact on soil fertility and agricultural productivity remains uncertain. From a local perspective, environmental priorities might have less to do with fulfilling accession requirements than the urgent challenges of everyday life.
There can also be conflicts of interest at the local level on the path of green reforms. For example, the legality of wind farm construction in ecologically sensitive areas of the Carpathian mountains is much discussed in regions of western Ukraine. Research on the impact of the war on people-nature relations in settlements in the Kyiv region shows that residents are torn between urgent priorities, such as rebuilding homes, restoring livelihoods and demining agricultural land, and concerns about forest loss, pollution and degraded green spaces that used to provide recreation, food and informal incomes.
Arguably, given the difficult circumstances in which Ukraine is pursuing its reforms, today’s environmental priorities should focus on the issues most urgent for human well-being, such as supplying sustainable and autonomous energy, ensuring safe water and food supplies, and rehabilitating ecosystems. However, European donors and partners, while motivated by the political will to support Ukraine’s EU integration in all aspects of the accession negotiations, risk adding to the perception that everything must be addressed at once. This makes it more difficult to maintain clarity about which problems are most urgent and how limited funds should be spent for long-term benefit, especially in challenging policy areas such as the environment and natural resources.
Local governance
Ukraine’s decentralisation reform is widely depicted as a success story among the post-Euromaidan reforms and an important driver of Ukraine’s resilience to Russia’s invasion. However, the persistent centralisation of executive power, particularly under martial law, has constrained the autonomy of local and regional self-government bodies.
In response to Russia’s full-scale invasion, temporary state bodies known as local military administrations have been created in some of Ukraine’s regions and cities. However, the vague conditions for establishing these military administrations, their differing working methods and their increasing influence have raised concerns among local authorities. Researchers have highlighted the risk that central government could use the establishment of military administrations as a political instrument to increase pressure on or remove local political opponents. These concerns came to the fore following the establishment of a military administration in the city of Odesa in October 2025, which some argue has effectively sidelined local self-governance.
Moreover, where military and civil authorities exist side by side, the overlap between their roles can lead to confusion and dissatisfaction among local stakeholders, especially in a context of staff shortages and work overload. Military administrations often deal with questions that are particularly salient in Ukrainian localities, such as mobilisation, the working conditions of military personnel, and the reintegration of veterans. Overlapping competencies complicate decision making and impair service delivery, and can make lines of responsibility and accountability less clear.
Another issue where the requirements of waging a full-scale war can be at odds with the continued empowerment of local governance is the centralisation of budgetary control to finance the war effort, for example through redistribution of the personal income tax paid by military personnel from local budgets to the state budget. In one ongoing conflict over budget authority, the Chernihiv city council has appealed to the Supreme Court to contest a ruling that the city’s budget must be approved by the military administration.
While intended to enable effective and strategic use of resources, the centralisation of budgetary powers risks weakening local fiscal autonomy. This can affect the ability of local authorities to act independently according to specific needs and circumstances, including on engagement with donors that invest in rebuilding and recovery efforts. For European partners, concentrating reform assistance in central institutions or national funding mechanisms can inadvertently constrain the direct engagement of regional and local authorities, thereby further reducing their agency and autonomy.
Conclusions and recommendations
Ukraine’s EU integration requires political will at the highest level, national strategies and effective policy execution by central government. At the same time, local communities and civil society organisations need to be involved if reforms are to be effectively implemented in the long run. By better adapting to the diverse, multi-level political landscape in Ukraine, European reform support could become more participatory, empowering and adapted to local needs. Reform support strategies might also benefit from closer analysis of the effects of the war on resource distribution, policy dilemmas, and governance issues at the local and regional levels. To these ends, European policymakers are recommended to:
- Improve local communication and presence. European partners and donors should enhance their direct communication and cooperation with local authorities, for example, by setting up local offices and travelling more in the regions. Visits by European peers to Ukrainian communities allow for mutual exchanges of knowledge and better targeted cooperation, and create bonds between people that strengthen bilateral relations and resilience. International donors could also engage with the existing regional offices of hromada associations, where hromada leaders can discuss local challenges.
- Empower local actors. Insofar as it is possible, international donors should aim to work through and with local actors, rather than rely on external consultancies. The working methods of the Swedish-funded Polaris Programme, which involve direct support to local self-governance and municipal partnerships to enhance the capacity of hromadas to deliver public services and implement reforms, set a positive precedent.
- Provide inclusive and flexible financing. To ensure that reform support does not exacerbate unbalanced resource distribution in Ukraine, European donors could eliminate potential geographical restrictions on reform support projects. Flexible financial frameworks, including, where appropriate, interest-free loans or large initial funding to finance project implementation, could make reform support more inclusive. Donors could also encourage smaller and rural hromadas to co-apply for projects through regional and local associations.
- Agree on priorities. European donors could improve horizontal coordination on supporting Ukraine’s EU integration, especially in technically complex areas such as climate change and the green transition. Thematic mapping exercises involving European donors and Ukrainian national and local stakeholders could help to identify which elements of EU legislation should best be prioritised for Ukraine’s war-effort and resilience. Ensuring that support for Ukraine’s EU accession delivers tangible results aligned with local needs would help to strengthen local ownership of the integration process.
