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Two years of Poroshenko’s presidency: dangerous political maneuvers next to a battlefield

On February 20th 2014, 53 people were shot dead in central Kyiv. Altogether, the death toll between February 18th and 21st reached 113 people. Two years on there are still no feasible answers to the main questions both about the killings and the future of the country.

June 27, 2016 - Yegor Vasylyev - Articles and Commentary

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Image by World Economic Forum

The useful memories or Komsomol United

The new Ukrainian authorities failed to give a satisfactory response to the stockpiling questions of the voters. They promised a lot: to finish the anti-terrorist operation within hours, to fight tax avoidance and the use of off-shore tax havens, effective anti-corruption lustration of law-enforcement bodies, a war with oligarchs and a visa-free regime with the Schengen zone within the first year of Poroshenko’s presidency. None of the promises have been fulfilled.

The first generation of post-Orange Revolution officials came from various backgrounds, but the key positions were filled by those sidelined during the oligarchic competition of Leonid Kuchma’s epoch.  Many of them were united not only by their political ambitions, but also by their background as children, step-sons or spouses of the Soviet nomenclature (such as Yuriy Lutsenko, David Zhvaniya, Oleksandr Tretyakov, Petro Poroshenko or Yuliya Tymoshenko) and former Komsomol activists. The first-rank “orange” officials included Anatoliy Matvienko, once the first secretary of the Ukrainian Komsomol, the late Oleksandr Zinchenko – the second secretary of all-Soviet Komsomol and Mykola Martynenko – once a secretary of Kyiv Komsomol.

Most of them, like Petro Poroshenko, have never been in conflict with Leonid Kuchma. However, none of them enjoyed benefits similar to Kuchma’s protégées. The most ambitious members of the “Komsomol United” team, Poroshenko, Martynenko, Zhvaniya and Tretyakov, have been commonly referred to as President Yushenko’s “Lovely Friends”.

The period immediately after the “Orange Revolution” saw an intense struggle for influence between the group members, reminiscent of the old Soviet traditions. Poroshenko, Victor Yushenko’s favourite, tried to control the executive from the chair of the Head of the National Security Council, a position devoid of any real influence. All in all, the power struggle ended with mutual accusations of corruption by the competing camps and the notorious Yushenko’s reload of the executive, which brought the old oligarch networks and the Kuchma-friendly Yuriy Yekhanurov as Prime Minister. Later, during the rule of Viktor Yanukovych, most of the “Komsomol United” remained in the opposition, but some of them joined the government, such as Petro Poroshenko serving as the Minister of Economy.

However, it was only a matter of time until the “orange camp”, including the imprisoned Yuliya Tymoshenko and Yuriy Lutsenko, returned to the game.

Komsomol United 2.0

The second post-Maidan generation of politicians is to an extent a return of the “Komsomol United.” Led by Petro Poroshenko, whose nostalgia for the Komsomol years is well-known (it should suffice to remember the lavish party he organised to commemorate the anniversary of the organisation’s founding in 2011), and revitalized and renewed, it includes Poroshenko’s army mate and business partner Ihor Kononenko (formerly, a secretary of Komsomol at one of Kyiv’s institutes), Borys Lozhkin, Anatoliy Matvienko and his nephew Sergiy Berezenko, the former secretary of Lviv Komsomol – Ihor Gryniv and the Russian oligarch Konstantin Grigorishyn. Even Lozhkin, ironically, started his journalist career in Kharkiv Komsomol’s newspaper. The increased informal roles of Oleksandr Tretyakov, Oleh Hladkovskiy (Svynarchuk) and Oleksandr Granovskiy are also worth noting.

The two years of Poroshenko’s presidency have been characterised by constant political maneuvers and balancing between the interests of the oligarchs (with an initial aim of limiting them), highly populist rhetoric and the advancement of Poroshenko’s own clan, including its Vinnitsa branch headed by the current Prime-Minister, Volodymyr Groysman.

Poroshenko’s propensity for informality has played a pivotal role in the country’s governance. It has raised accusations of informal deals between the President and the oligarchs and the use of smotryashie (‘looking after’) – informal economic and political patronage, including in the oil and gas sector. All of these have been long-established patterns among the Soviet elite, Komsomol, KGB and criminal circles, a symbiosis of which shaped the development of post-Soviet states.  The second Maidan once again resulted in the return of informal post-Soviet models, and the current decision-makers represent a slightly westernised version of their earlier counterparts. The rotation has been supported by the mass change of colours on the part of the Ukrainian elite.  

The kingpin of the system is rumored to be holding regular informal meetings, the format of which changes depending on the issues discussed. It works as an informal club making decisions about the country’s future. The “grey cardinals” such as Kononenko, who allegedly puppeteers the political process and exerts huge informal influence on the President, and Martynenko, who is under criminal investigation in Switzerland, have been vastly discredited in the eyes of the public, but it still has not affected their position. 

However, the President has not managed to cede responsibility for the internal processes in the state solely to the Prime Minister, but has been in charge of the situation in the eyes of the electorate, which is aware of the direct relationship between the Prime Minister and the President. It also means that his ratings are directly influenced by government’s actions or lack thereof.

Invisible reforms

Arseniy Yatseniuk’s “cabinet of technocrats”, which in part outsourced the country’s governance to foreigners turned Ukrainians, was by and large a branch of the informal networks of the Head of Presidential Administration, Boris Lozkhin.  Lozkhin saw “no point in building anti-oligarchic strategies” and the Cabinet ended up as one of the most unpopular of the Ukrainian governments. 

The notorious corruption schemes coupled with International Monetary Fund loans did not help Ukraine’s economy, which has been in a state of stagnation for a long while. However, according to Anders Aslund, Yatseniuk’s government has still implemented more reforms than any Ukrainian government before it. Indeed, one should acknowledge the partial reform of the energy market, as it has helped to eliminate some of the corruption schemes,  some deregulation measures, as well as introduced the new electronic system of public procurement (although it is yet to prove its efficiency). Nevertheless, the Ukrainian public has so far seen little positive effect of those measures. Only police reform has enjoyed a broad public support.

When it comes to law enforcement, the Council of Ministers should not be blamed for the failure of reforms, as the Prosecutor General is appointed by the Parliament upon President’s submission. The Prosecutor General’s office under Viktor Shokin will be remembered for the highly controversial process of re-attestation of the prosecutors, flopped cases of tackling high-level corruption and an overall anti-reform corporate solidarity with the old system.

The fight against corruption has been always at the frontline of public attention and it has clearly been lost. Observers stress the helplessness of the legal system in tackling all-pervasive corruption and refer to the famous post-Soviet Catch-22, a trap where the law and both formal and informal leverages are under control of the same corrupt patrons. In this sense, being legal means no corruption fight and thus no reforms.

Yuriy Lutsenko, the new Prosecutor General and a long-term associate of President Poroshenko, re-announced the reform of the prosecution service, but so far has avoided any review of the investigation department. Also the public has been skeptical of Lutsenko’s potential given the failure to reform the Ministry of Internal Affairs during his “orange” ministerial term.

Public expectations are still high when it comes to the newly-created National Anti-Corruption Bureau, which is scheduled to hold its first serious investigation of high-level political corruption upon receiving materials from the former deputy Head of Security Service, Viktor Trepak. However, the institution, despite its promising legal basis, is under threat of a similar failure as new laws and institutions often cover up further corruption in the post-Soviet political games. That is, the implementation of laws runs a distant mile from the alleged reform aims. In the worst case, the institution will become yet another branch of informal influence to serve the interests of competing clans.

More promises of judicial reform, including constitutional amendments, have been met with skepticism on the part of the experts. First of all, low expectations concern the re-attestation of judges. Since the process will be conducted by the judges themselves, the majority of them will most probably retain their positions. The old system is eager to defend itself by all means and the rule of law this time will be invoked to protect the incumbents.

Eagerly anticipated is the litmus test for the Ukrainian authorities later this year: the announced privatisation of the “cherries” (state enterprises) left untouched by the highly dubious earlier privatisation waves. The question is whether they will become prizes in an ongoing informal oligarchic competition.

A steady downfall?

Poroshenko’s dream scenario of Volodymyr Groysman keeping his seat as the Prime Minister till the end of the presidential term in 2019 is highly probable. The opposition, that is Yuliya Tymoshenko’s Batkivshyna and Samopomich, has no capacity to torpedo the stable coalition of former members of the Party of Regions, oligarchs’ protégées and MPs supporting the President.

Those demanding most radical reforms pin their hopes on the Georgian president turned Ukrainian Odesa governor, Mikheil Saakashvili. Accused of dubious financing of his reforms’ fund and the lack of concrete vision for the region’s development, Saakashvili has been involved in a real political war. He has met fierce opposition from both his enemies in central government and the Odesa mayor’s team. Having run an all-Ukrainian public anti-corruption campaign, he has been accused by his opponents of failing to achieve any substantive results in the region of his immediate responsibility. Saakashvili counters the claims by pointing to successful tackling of smuggling and corruption at the notorious Odesa customs services and requesting more support from Kyiv.

Politically ambitious, the former Georgian president cannot stand for Ukrainian presidency – an office he might have a chance of winning- due to legal restrictions. Therefore, his highest feasible political ambition in Ukraine would be Prime Minister’s chair, which he is unlikely to be offered under the current president. At the same time, his opponents hope for his relocation back to Georgia, especially in light of his party’s growing public support.

Having three more years in office, if they carry on with the current tactics and strategies, the Poroshenko-Groysman tandem will most likely repeat Viktor Yushenko’s record of deep unpopularity and grossly fail the re-election. Due to the lack of anti-corruption and anti-oligarch reforms, Poroshenko is likely to lose it to several candidates, including Yuliya Tymoshenko, whom he so triumphantly defeated in the first round of 2014 election.

Ukraine’s President is far from meeting his promise to end the anti-terrorist operation, with the Minsk agreements in the impasse and Western partners losing patience with Ukraine’s position. Russia might have a plan for radical escalation once again, possibly in the Zaporizhia, Kherson, Odesa and Kharkiv regions, but that would require a radical change of events in Kyiv. There are no more de facto Ukrainian territories with a dominant Russian majority and the price for an open military aggression is too high for the Russians to pay. It is thus currently not an option for Vladimir Putin.

At the same time another Maidan is hardly possible, due to the lack of such factors as gross election fraud or blatant violation of civil liberties that usually precede revolutionary events. This seems especially clear given that the ever-pressing issue of the country’s geopolitical orientation has been resolved, with the pro-Western front prevailing on the national level. In other words, there is no unifying cause for public mobilisation and active protests against the highly unpopular authorities. In addition, the memories of violence and deaths are still vivid, and so is the question of the price society would have to pay for yet another rotation of post-Soviet elites. 

The divisions within the country have decreased due to the loss of the most pro-Russian territories, but Ukraine is still incapable of an economic and social breakthrough. It is still waiting for a new generation of democratically-minded politicians who will keep their promises and invest in the country’s future. For the moment, the country seems doomed to remain in the ever-present shadow of the post-Soviet political and economic patterns with the roots in the late-Soviet Union and implemented through the change-proof oligarchic system.

Although Ukraine has increased its military capacity, it is still incomparable with that of Russia, and in the foreseeable future it will have to accept the threat of hybrid warfare and a struggling economy badly in need of IMF loans.

The results of the referendum in the Netherlands might be more symptomatic of what is going on within the European Union than it is usually assumed. EU-skepticism currently on the rise in many EU states is inevitably a skepticism towards EU enlargement, for which Ukraine, having failed the reforms, is not ready in any case.

As the issue of post-communist transition is off the table, the question which remains is whether a transformation of Ukraine’s oligarchic and clan system into anything more transparent and rules-based is possible. For the moment, the answer is far from “yes”.

Yegor Vasylyev is an analyst specialising in politics and transition of post-Soviet states. He holds an LLM in European Law from the London School of Economics and Political Science, where he was a British Chevening Scholar in 2009-2010, following five years in the Ukrainian civil service. 

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