How Ukraine’s decentralisation makes the country more resilient and helps post-Soviet democratisation

House with Chimaeras, Kyiv. Ukraine. The art Nouveau building has been used as a presidential residence for official and diplomatic ceremonies since 2005. Photo: Juan Antonio Segal (cc) flickr.com

While the new conflict at the Kerch Strait, rising tensions in the Azov Sea, creation of new anti-corruption institutions, and acquisition of autocephaly by the Ukrainian Orthodox Church etc. are hotly discussed themes, the simultaneously ongoing reform of Ukraine’s administrative structure appears as a somewhat boring topic. Largely unnoticed in the West, Ukraine’s ongoing local governance reform has, however, become one of the most consequential post-Euromaidan transformation efforts since 2014. The fundamental rearrangement of political power and public finances currently being implemented within Ukraine’s state is often simply labelled as “decentralisation”. In the West, Ukrainian decentralisation is sometimes wrongly seen as something imposed by the West, started by the EU’s Association Agreement with Kyiv, or even triggered by the conflict with Russia and the related Minsk Agreements in which the term “decentralisation” appears.

Deeper Ukrainian roots of decentralisation

In fact, Ukraine’s current local restructuring has national rather than foreign roots. It had been envisaged for a long time as well as planned in considerable detail before the Euromaidan Revolution and was already about to be implemented after the Orange Revolution. Ukrainian decentralisation reform today combines a number of separate transition processes that touch upon both the input and output aspects of rural and urban politics. It already reaches deep into daily matters of ordinary people and has the potential to fundamentally change Ukrainian state-society relations. Small basic communities are merged into larger, more sustainable territorial units. Central administrative agencies are stripped from their old prerogatives to the benefit of elected territorial and city councils. Budgetary and legal competencies are transferred from national and regional organs down to the local level. Responsibilities in such fields as school education and public health are handed over to amalgamated self-governing communities.

As everywhere in the world, decentralisation in Ukraine leads to beneficial effects for the everyday life of citizens. Public administration becomes more rational, flexible and transparent. State-society relations strengthen and democratic accountability increases. Opportunities for realising corrupt practices are gradually reduced. Economic activity in local communities is increasing, as are cross-regional competition that will positively affect trade and innovation from the local to the national levels. Civic activism is encouraged and utilized for the public good. Talented youth in provincial regions can better self-realize at home. Communities compete for direct investments, touristic visitors, project funding, and qualified personnel. Local grassroots initiatives can transform more easily into efficacious public policies and become templates for nationwide innovation.

In Ukraine, such positive effects of decentralisation gain additional weight in view of the country’s significance as one of Europe’s territorially largest nations, civilisational frontier states, crucial post-Soviet republics, and geopolitical pivot countries. Whatever course Ukraine takes in its domestic affairs has larger implications for pan-European security and stability, post-communist international relations and development, and East European liberalisation and democratisation. If, when and to the degree that Ukraine becomes more resilient, cohesive, Western and successful as a result of decentralisation has wider implications for the spread and impact of European values across the Eurasian continent.

Enhancing Ukraine’s sovereignty

Decentralisation makes Ukraine as a state and nation more resilient in that it reduces, suppresses or contains various post-Soviet pathologies of public administration and local development. To be sure, post-Soviet Ukraine has – unlike the Russian (so-called) Federation or other authoritarian successor republics of the USSR – never been a particularly centralized state. Instead, for most of the last 25 years, Ukraine has suffered from informal regionalisation into semi-autonomous fiefdoms controlled by rapacious political-economic entrepreneurs and their mafia-like structures. Behind the scenes, certain magnates, bureaucrats or deputies functioned (and often continue to function) as powerful patrons of clientelistic networks that deeply subvert and partially control official governmental, non-governmental and commercial organisations.

The reach of this or that oligarchic clan could cover a specific macro-region, like the Donets Basin (Donbas), one particular oblast (region), or a certain larger city and its surroundings. In addition, linguistic, cultural and religious differences have been sharpening territorial divisions within the formally centralized Ukrainian state. Ukraine’s unregulated regional crypto-regimes undermined the rule of law, hindered economic growth and prevented political development. Domestic and foreign investors, for instance, could (and partly still can) become victims of ruthless raiding attacks leading to their – sometimes full – expropriation by the locally dominant clan. 

Though not a miracle cure, decentralisation is pivotal to improvement

The distinctly local focus of Ukraine’s governance reforms does not fully do away with these clan-like structures; nevertheless they help to weaken, chase away, and dissolve them. Ukrainian decentralisation devolves power to a level lower, and to communities smaller, than those on which most of the old informal fiefdoms operate. While state-capture by private interest is still possible, Ukraine’s decentralisation reforms are significant because they make this behavior more complicated and less attractive for super-rich semi-criminals. To be sure, sometimes decentralisation simply transfers corruption from the national or regional to the local level. In certain cases, it can even benefit clans that have been hitherto functioning within a communal or municipal context.

On the whole, however, decentralisation in Ukraine – like everywhere else in the world – strengthens, rather than weakens, the rule of law and promotes economic development. Newly empowered local self-governing bodies are more exposed to public scrutiny and responsibility than Ukraine’s byzantine administrative organs inherited from the Soviet system. On average, Ukraine’s novel Amalgamated Territorial Communities (ATCs) are less susceptible to subversion by informal networks than the old oblast and rayon (county) administrations and councils. More so than the smaller and less powerful older communes, the new ATCs are motivated to engage in competition with other ATCs for attracting private investment, providing public services, and gaining national fame.

Moreover, the currently ongoing devolution of power to the local level in Ukraine deprives Russia’s various hybrid warriors of critical reference points for future subversive action. A decentralisation that is not a federalisation complicates the targeting of irredentist operations similar to those that were successful in Simferopol, Donetsk and Luhansk in 2014. As regional capitals and governments gradually lose political relevance, it becomes more difficult for the Kremlin to delineate the territories where it may want to support secession and/or prepare annexation. Therefore, the breakup of Ukraine’s still largely Soviet administrative system is also seen by Ukrainian political activists and experts as a mean to consolidate and protect the Ukrainian state. The disempowerment of oblasts, as well as rayons, and the simultaneous empowerment of local communities devolve and deconcentrate the distribution of power across the country. This fragmentation of decision-making gradually eliminates effective entry points for Russian subversive measures aimed at destabilisation and separation of entire regions.

Decentralisation thus makes the Ukrainian state more resistant, functional and effective. Ukraine’s increased resilience and greater dynamism supports its general modernisation. Whatever, in turn, makes the largely pluralistic and liberal Ukrainian state stronger – Europeanisation, decentralisation, privatisation, deregulation, etc. – also undermines the legitimacy of the kleptocratic and autocratic orders of other post-Soviet states. Moreover, decentralisation experiences in Ukraine can, in the future, provide policy directions and institutional templates ready for use by other, so far, highly centralized post-Soviet states in their forthcoming reform efforts. This concerns not only, but above all Russia herself for which decentralisation may one day become relevant, as an instrument for reducing corruption, inefficiency and separatism. By strengthening Ukraine’s democracy and economy, its decentralisation helps to change the entire post-Soviet area for the better.

Andreas Umland is a senior fellow at the Institute for Euro-Atlantic Cooperation in Kyiv and general editor of the ibidem­-Verlag book series “Soviet and Post-Soviet Politics and Society” distributed by Columbia University Press.

decentralisation, democratisation, post-Soviet, reforms, Ukraine