Ukraine’s challenges in the time of a pandemic
Interview with Aleksandra Reshmedilova, a leading political expert at the Civil Diplomcy Fund. Interviewer: New Eastern Europe.
NEW EASTERN EUROPE: The whole world now fights with the COVID-19 pandemic. What is the situation like in Ukraine and what measures have been put in place by the government?
ALEKSANDRA RESHMEDILOVA: Ukrainian authorities acted proactively and did not allow an uncontrolled spread of the virus. The decision to implement a quarantine throughout the country was made on March 11th 2020, when the virus was not yet widespread in Ukraine. Officially, Kyiv imposed restrictions on the border, which affected the entry of foreign citizens and the functioning of the entire international air service. Subways in all major cities were also stopped. Rail, air and bus services between the regions were discontinued. Thanks to the strict decisions of the authorities, it was possible to minimise the spread of the virus.
As of May 18th 2020, Ukraine has 18,615 confirmed cases of COVID-19 infections. Five thousand and two hundred seventy six people have already recovered and the number of deaths is 535. The quarantine has been prolonged until May 22nd but some restrictions have been lifted. Parks, summer cafés and shops that sell non-food products will be opened.
Compared to global statistics, the rate of those recovering from the virus in Ukraine is significantly lower (14.7 per cent in Ukraine; 31 per cent in the world). First of all, this is due to the fact that the majority of recorded cases occur in countries where the epidemic has lasted several weeks longer. Many patients have already recovered and passed all necessary tests. As for the mortality rate, in Ukraine it is 2.5 per cent and globally it is seven per cent. Regarding negative developments, it appears that among confirmed cases of the disease almost 20 per cent have been doctors.
The fight against this epidemic has demonstrated the need to review the medical reforms launched by the previous health minister, Ulana Suprun. Even the president acknowledged that there are now a lot of questions surrounding the previously proposed model of change in the healthcare system.
How is Ukraine planning to prevent budget difficulties caused by the pandemic?
The Verkhovna Rada has voted for a number of laws regarding the introduction of additional measures to support citizens and the economy during quarantine. These will help mitigate the negative consequences of the country’s lockdown. In particular, business incentives regarding the payment of income tax were established, deadlines for submitting all reports were postponed, and a ban on raising credit rates for the period of quarantine was also introduced. The government obliged all banks to remove the penalty for late payments on loans for individuals. Certain compensations were offered for representatives of small businesses. This concerns the settlement of rental payments for real estate if the tenant could not use it for its intended purpose in the agreed period of time. In general, a whole range of amendments to the tax code were adopted, which are directed at resolving the economic situation in the short term.
The Ukrainian parliament supported the creation of a special fund to combat coronavirus. Around 64.7 billion hryvnia was allocated to it.
The main problem is that the budget of Ukraine is very limited and this year there may be a deficit of up to 300 billion hryvnia. In such circumstances, it is very difficult to organise direct social payments or save many entrepreneurs from bankruptcy. Let’s be objective, the economic measures which have been taken are not enough, but there are not enough resources to improve the situation. Therefore, the country’s leadership is hoping for external borrowing and international assistance.
What do you think about personnel changes in the Ukrainian government and appointment of Mikheil Saakashvili? What responsibilities could he receive? Do oligarchs, or any other groups, have any influence on the new government?
Admittedly, Volodymyr Zelenskyy has made some mistakes in staff decisions. The parliament approved the new cabinet nominated by Prime Minister Alexey Goncharuk, who received direct support from the president. Such a move, however, was not constructive. For the last five years, Goncharuk’s utopian promises of GDP growth up to 40 per cent have remained on paper, declarations regarding quick reforms to the system yielded no results, and “new faces” in ministerial seats failed to solve old problems. In practice, expectations and promises did not become reality. The government did not collect taxes and failed to expose the country’s black market and corruption schemes. The state was also not ready for the coronavirus pandemic. In addition, Goncharuk was involved in a big scandal after the release of videos in which he accused the president and himself of economic incompetence.
Volodymyr Zelenskyy responded to the first problem very quickly. Against the backdrop of the global pandemic, Zelenskyy’s team approved the new cabinet nominated by new Prime Minister Denis Shmygal. On the sidelines of Ukrainian politics, the popular opinion is that changes in the government significantly weakened Igor Kolomoiskyy’s influence. This strengthened the position of Rinat Akhmetov, another influential businessman. Many of the new cabinet’s decisions have proven favourable to the interests of Akhmetov. For example, a partial shutdown of nuclear reactors will increase revenue in the electric power and alternative energy sectors. The oligarch has various enterprises in these markets.
As for Mikheil Saakashvili, the rumours about his appointment resulted in a lot of criticism. Despite official statements, Zelenskyy’s party Servant of the People failed to find the votes needed to approve the politician’s position in the cabinet. Saakashvili even had to meet with representatives of the political party Voice, in order to gain their support. These efforts have not paid off and the former Georgian president was looking for a new role. It was even suggested that he could possibly negotiate with the IMF on behalf of Ukraine. Finally, Mikheil Saakashvili received a high post in the National Reforms Council. In any case, his desires to return to an official position in Ukraine is already creating the preconditions for a conflict with Georgia. The Georgian president and diplomats have already expressed their concerns. Despite the Saakashvili administration’s successful reforms in Georgia, he is not trusted in Ukraine. In the last parliamentary election, his party won only 0.4 per cent of the vote. Everyone remembers his conflict with Petro Poroshenko and Arsen Avakov and that is why they see Saakashvili as a counterweight against the leader of European Solidarity and the Minister of Internal Affairs.
And what about the Ukrainian Parliament? Why are there are so many problems in voting on important laws? Is there a split in the coalition?
Talk of a split in the coalition or the threat of its collapse is simply untrue. Of course, sometimes there is a confrontation between influential groups, but so far no one is interested in destroying the current system. Even a group of deputies, who are often associated with Igor Kolomoiskyy, do not show a desire to leave the faction in order to bring down the parliamentary majority. During the quarantine period, authorities had to table votes for many laws that affect the interests of influential players. For instance, the land market and banking law. In the case of the former, deputies from the Servant of the People had to enlist the support of European Solidarity and Voice. In the case of the latter, these groups tried to block the so-called “anti-Kolomoiskyy” law by demanding a large number of amendments. In fact, the authorities had to look for legislative loopholes in order for the second law, which is required by the IMF, to even be considered. They found them and voted on the law amending the regulations. As planned, now an individual deputy will not be able to submit an unlimited number of amendments to the text of the draft law and all technical amendments can be rejected without consideration in parliament by the profile committee of the Verkhovna Rada. This mechanism will greatly simplify the procedure for adopting laws. However, there are many questions regarding its legality.
To make such a decision, Servant of the People had to find agreement with 15 representatives of Viktor Medvedchuk’s party Opposition Platform — For Life. This was a sensational political development. There are rumours that the opposition, who voted for changes to the rules, are included in the influential group of Sergei Levochkin, the deputy and “gray cardinal” of the Viktor Yanukovych era.
Thus, it can be stated that the integrity of the coalition was violated during voting for some laws. But there are no hints of its imminent collapse. Servant of the People managed to push complex laws through parliament, but the problem is that deputies continue to use blocking mechanisms, such as in court. Taking into consideration these circumstances, the parliamentary struggle is only gathering speed.
Has the Ukrainian president kept control over state-building processes and are Ukrainians satisfied with the results of his presidency after one year?
The president has retained control over the situation in the country in coordination with other government bodies. There remains a parliamentary majority, a new cabinet has been formed and the head of the president’s office, Andriy Yermak, who plays a large role in Ukrainian politics, has maintained his position.
Over the past year, Volodymyr Zelenskyy has achieved many important political changes, but his many mistakes should not be forgottten. If we talk about foreign policy, the president’s team showed itself to be constructive in relation to Russia. They managed to free many Ukrainian hostages, started negotiations regarding Donbas and and extended the agreement on the transit of gas from Ukrainian territory to Europe. In general, these points can be viewed as positive. Ukraine also began to develop dialogue with our Polish friends. A meeting of the two presidents was also held and discussion is helping to overcome long-standing difficulties.
If we talk about domestic politics, it is necessary to be objective. Despite the power of Volodymyr Zelenskyy and his team, not everything in the country depends on him. The president’s inner circle and his party have also failed in many of their responsibilities. Let’s speak frankly, during this year various mistakes were made. There are many reasons for this. For example, lack of experience, the destructive competition of influential groups and weak personnel. The coronavirus pandemic placed an additional burden on the government and created new challenges. The team of Volodymyr Zelenskyy should realise that their honeymoon period is over and that concrete results are expected from them. The second half of 2020 will be a defining moment. So far, the ratings of Servant of the People and the president remain at a fairly high level. According to recent polls, in the event of an early parliamentary election, 38 per cent of voters would vote for the “servants”. If a presidential election were to take place, Volodymyr Zelenskyy would get about 45 per cent of the vote. As you can see, the government boasts a fairly large level of societal trust.
In the last film about the political activities of Zelenskyy, he promised to continue attempts to stop the war till the end of his presidency. Is this possible and what is his strategy?
The president identified peace in Donbas as the main goal of his election programme. The first year of his presidency showed a desire to achieve as much as possible in relation to a diplomatic settlement of the war. Zelenskyy succeeded in resuming the work of the Normandy Format. Ukraine is the first country to implement a package of measures related to the Minsk agreements. It was also possible to negotiate with the Russian side and exchange hostages. Ukraine openly declared its readiness to improve the conduct of elections in the occupied territories. Unfortunately, the situation has come to a standstill on several issues. The first point is that Zelenskyy is ready to hold elections according to Ukrainian law. This will demand the establishment of control over Ukraine’s borders before the election day and the disarmament of all illegal military units. The second point is connected with the first and means making amendments to the Minsk agreements. Officially Kyiv did not hide its desires to hold elections in October 2020, providing that Russia agreed to make concessions and partially revise some agreements. Germany actually supported Ukraine in this matter when Angela Merkel supported the political flexibility of the Minsk process at a Normandy Format meeting. The third thing is a lack of compliance with safety standards. The Ukrainian military continues to experience shelling by militants and there is no consensus regarding the withdrawal of forces. Russia continues to try to relieve itself of responsibility, which significantly complicates a peaceful settlement.
The Ukrainian president’s office does not hide the fact that they have chosen a strategy to achieve peace thanks to the Minsk agreements. As a serious step, Zelenskyy decided to form a Ukrainian delegation with official members of parliament and the ministerial cabinet. As he promised before, he has created a new opportunity for peaceful negotiations. Now the ball is on the Russian side.
The implementation of the Ukrainian plan requires mutual concessions, which means updating the package of measures and taking into account changing circumstances. According to Zelenskyy’s team, this is the only way that the Minsk process can be revived and be brought to a peaceful end. If Russia does not show a flexible position and does not want to promote peace, Kyiv will have to focus on preventing an escalation of hostilities. I do not exclude the possibility that in this case, Zelenskyy may choose another strategy. His goal will be to maintain the status quo and achieve a permanent ceasefire in order to avoid casualties. There were no official statements from the president’s office regarding the possibility of such a scenario. Many signals behind the scenes, however, suggest that they may be thinking about this. Thus, at this stage, Zelenskyy’s main strategy is to try all diplomatic methods and then respond to the changing dynamics of the conflict.
Aleksandra Reshmedilova is a leading political expert at the Civil Diplomcy Fund.
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