Corruption may send Ukraine back into the Russian orbit
With all the focus on the Middle East turmoil, Ukraine’s importance to the West should not be overlooked. When Ukraine’s pro-Russian President Viktor Yanukovych was ousted in 2014 by public protests sparked by his refusal to sign an association agreement with the European Union, he fled the country. Then details of his lavish lifestyle were exposed to public view, and the full extent of his corruption became clear. Together with his corrupt cronies, Mr. Yanukovych, who now remains a guest of Vladimir Putin, is believed to have stolen upwards of $100 billion. Unbelievable.
When a pro-Western government headed by current President Petro Poroshenko took over, Ukrainians hoped for genuine reforms that would take their country out of Moscow’s sphere of influence and end the blatant corruption that characterized his predecessor’s tenure. That’s certainly was the mood when I was in Kiev. Regrettably, more than two years after Mr. Poroshenko’s election, real reform remains elusive.
As Reuters commentator Josh Cohen has put it, in today’s Ukraine corruption is so bad, a Nigerian prince would be embarrassed.
As documented by Mr. Cohen, “over $12 billion per year disappears from the Ukrainian budget, according to an adviser to Ukraine’s National Anti-Corruption Bureau (NABU). In its most recent review of global graft, anti-corruption watchdog Transparency International ranked Ukraine 142 out of 174 countries on its Corruption Perceptions Index — below countries such as Uganda, Nicaragua and Nigeria.”
“The worst corruption,” Mr. Cohen says, “occurs at the nexus between business oligarchs and government officials. A small number of oligarchs control 70 percent of Ukraine’s economy, and over the years have captured and corrupted Ukraine’s political and judicial institutions. As a result, a ‘culture of impunity’ was created, where politicians, judges, prosecutors and oligarchs collude in a corrupt system where everyone but the average citizen benefits.”
One of the biggest opportunities for corruption is found, ironically, in the reform process and the “fight against corruption” itself, specifically discriminatory use of government power to reward its favorites and punish opponents. For example, as noted by Ukraine expert Taras Kuzio, three Ukrainian politicians from pro-Western political parties, were publicly and aggressively arrested simply for falling out of favor with Mr. Poroshenko.
As an example, parliamentarian Oleksandr Onishchenko of Ukraine’s People’s Will, a party faction supporting European integration, has also run afoul of Mr. Poroshenko for selling natural gas at reduced prices. In a page right out of the Yanukovych years, Mr. Poroshenko’s “reformers” have acted as judge, jury, and executioner, trying to arrest Mr. Onishchenko and waging a media defamation campaign against him.
Without evident proof linking Mr. Onishchenko to supposed crimes, his real offense appears to be competing with oligarchic interests in Ukraine’s lucrative gas market. Pro-western former prime minister and opposition leader Yulia Tymoshenko, who was wrongfully imprisoned by Mr. Yanukovych’s regime for over two years, has questioned the motives behind the investigation of Mr. Onishchenko as well as many other Ukrainian entrepreneurs. “These days businesses are raided just like under Yanukovych, assets are grabbed,” she declared. “Today they seize Onishchenko’s assets. There is a lot of buzz about Onishchenko, but today there are many entrepreneurs whose businesses are being raided.”
Corruption has plagued Ukraine since it became an independent state in 1991. But after the sufferings and sacrifices of the Maidan “Revolution of Dignity” and 2004 “Orange Revolution,” why is true reform so elusive?
President Poroshenko himself appears to be more part of the problem than part of the solution. Western governments keep urging him to make reforms that would wrest Ukraine from the grasp of oligarchs, evidently forgetting that he’s an oligarch.
While campaigning for office, Mr. Poroshenko promised to sell off his businesses and focus exclusively on Ukraine’s interests. “Instead,” according to the Organized Crime and Corruption Reporting Project (OCCRP), “actions by his financial advisers and Poroshenko himself, who is worth an estimated $858 million, make it appear that the candy magnate was more concerned about his own welfare than his country’s.”
Unsurprisingly, Mr. Poroshenko himself shows up in the “Panama Papers” having illegally set up offshore shell companies via the notorious law firm Mossick Fonseca to conceal his assets. Oleksii Khmara, executive director of Transparency International Ukraine, told OCCRP that this is “a conflict of interest and apparent violation of both the constitution, which bans the president from business activities, and the corruption laws, which ban all public officials from conducting private business.”
The other problem is geopolitical. “The reason for the West’s seemingly endless patience [with Poroshenko] is obvious,” writes Lev Golinkin inForeign Policy. “It’s called Moscow. It’s hard to imagine Kiev’s brazen kleptocracy being handed dozens of ‘last’ chances if Ukraine were involved in a conflict with, say, Burkina Faso. But Kiev is in a standoff with Russia, a land considered by many in NATO to be a top threat, which gives Ukraine a symbolic and strategic importance.” So western governments, while encouraging reform, continue to support Mr. Poroshenko.
In the end, Mr. Poroshenko may yield the result the West fears the most. As U.S. Assistant Secretary of State Victoria Nuland stated in Senate testimony, there is a real risk that Ukraine will begin “sliding backwards once again into corruption, into lawlessness, into vassal statehood.” As Mr. Golinkin puts it, “Ukraine is turning into a 45 million person, Texas-sized pressure cooker in the middle of Europe.”
When it explodes, only Vladimir Putin will be ready to pick up the pieces. This cannot be allowed to happen.
This column was originally published in The Washington Times.