The State of Reforms in Ukraine
Ons 20.1.2016 kl. 10:00-12:00
In 2014-15 international attention was mostly drawn to the conflict in Ukraine’s east. However, as hopes are growing for the stabilization of the situation – though not yet for conflict resolution – it is high time to return to the core questions posed by Ukraine’s Euromaidan, or "revolution of dignity”. Two years from the dramatic events resulting in a regime change in Ukraine, the Finnish Institute of International Affairs together with the Institute of World Policy (Kyiv) are organizing a seminar that will analyse what has changed and what has yet to change in the country to make it a functional economy and a mature democracy. Are the authorities still able and willing to carry out the reform agenda? Is Ukraine capable of fighting corruption and the power of oligarchs? Do the necessary transformations still enjoy the support of the people and what are the biggest risks?
Daria Kaleniuk, Executive Director, Anticorruption Action Centre, Kyiv
Iryna Bekeshkina, Director, Ilko Kucheriv Democratic Initiatives Foundation, Kyiv
Chair & Comments: Arkady Moshes, Programme Director, the Finnish Institute of International Affairs
Summary of the Seminar
Director Daria Kaleniuk from the Anticorruption Action Centre in Kyiv started her presentation in a positive manner by stating that she believes that the reforms will happen, the question is when, and at what price. As the Maidan events took place, Kaleniuk and her team at the Anticorruption Action Centre understood that impunity was a reality during Yanukovych’s time, and that law enforcement did not stand a chance against Yanukovych and other senior officials. But according to Kaleniuk, Ukrainian journalists did a successful job as they managed to reveal crucial information about how money was laundered from the government budget. In cooperation with European jurisdiction and law enforcement, the Anticorruption Action Centre managed to stress the much needed EU-imposed sanctions – even though they came too late, Kaleniuk argues.
The next step for Kaleniuk’s team was to resolve how all the Maidan revolutionary energy could be transformed into a result-oriented way of thinking. The main goal was to eliminate impunity and really drive the reforms and legislative changes. Kaleniuk underlined that the reforms cannot happen if the corruption continues. Those guilty of corruption should be punished accordingly, not only lose their positions as it is now. The prosecution in Ukraine is one of the real challenges in the country, which Kaleniuk sees as a heritage from the Soviet Union. The prosecution has functioned as a tool of power for the oligarchs and as a tool to negotiate different political deals, which is very difficult to change.
The Anticorruption Action Centre had two main goals: to open up information and registries, and to set up a new anticorruption law enforcement institution, which turned out to be an enormous challenge. The idea behind open public registries is to allow people to see ownership and how the government funds are spent. According to Kaleniuk, a real success was achieved on the level of laws and the implementation of laws. The action centre established a functioning partnership with the government and especially with the minister of justice. The second goal was pursued through cooperation between partners from the civil society, government, parliament, the EU, the IMF and the World Bank, who together elaborated the idea of a national anticorruption bureau in Ukraine. In April 2014, the international organizations imposed the creation of an anticorruption bureau and the opening of registers as conditions for funding and visa liberalization. The same year, the legislation was passed after persistent work, so there is now a public registry for company beneficial ownership as well as real estate and land ownership. The new national anticorruption bureau has strong guaranties on independence, which is a result of a long struggle between the Anticorruption Action Centre and the government. Kaleniuk underscored that the presence of the EU within the process helped to prevent dishonest outcomes, and the bureau now chooses detectives through a transparent and competitive process. Kaleniuk concluded by saying that the leverage of the EU and other international organizations is very high, but it will most likely decrease in the near future due the end of the visa liberalization process and the end of financial support from the IMF. Though we expect possible steps back from government, NGOs if supported politically by international partners of Ukraine have good chances to defend all good anticorruption laws and ensure they are implemented well.
Dr Iryna Bekeshkina, Director, Ilko Kucheriv Democratic Initiatives Foundation, Kyiv presented a perspective from the Ukrainian society’s point of view and discussed the society’s expectations. According to Bekeshkina, Europe still sees the importance of Ukraine, even though it can be doubtful sometimes. No one expected a war, or such a struggle with the reforms, and now she sees this situation as a test for Europe to ponder its stand on politics of values and politics of profit.
Dr Bekeshkina stressed that comprehensive changes have taken place in the Ukrainian society during the last two years. Broadly speaking, the Ukrainians have been split between a choice of east or west. On one hand, there are people looking to the east for more integration with Russia and post-Soviet countries, and on the other hand those who look west towards integration with the EU. Despite the very dramatic last two years of Ukraine’s history there can be seen a consolidation of the nation in post-Maidan Ukraine, and national self-identification has increased. Although the people went through very tough times in 2013 and 2014, patriotism only grew among the Ukrainians during these years. When asked about the direction where Ukraine is heading, only 20 % of Ukrainians thought the country was going in the right direction in 2015. This was among other things due to more European integration, increased social activity, implementation of reforms and increased unity among the people. On the other hand up to 60 % of the people stated that Ukraine was going in the wrong direction because of the warfare in Donbas, high prices, corruption and the uncertainty of the future. When comparing these results, Bekeshkina highlighted that for both sides, economic issues are the most important factors. But according to her, these results are not surprising. This is usually the situation when public opinion is polled regarding the direction where Ukraine is heading.
The economic crisis in Ukraine has been substantial, which has had an impact on almost all of the Ukrainian people. According to public opinion, the socio-economic crisis has been caused by high levels of corruption, the oligarchization of economy, incompetent management, and military actions in Donbas. Bekeshkina pointed out the fact that these figures demonstrate that the people see corruption as a bigger problem for socio-economic development than the conflict in Donbas. The citizens’ response to who is guilty and who drives the reforms were in some regards quite clear. The Ukrainians see the government and parliament as brakes whereas the population and the NGOs are seen as the drivers for the reforms. Half of the population thinks that nothing has been done to enhance the reforms. Dr Bekeshkina underlines that much has been done in the sphere of law but not implemented in real life, which is why it is not evident to the citizens.
According to Bekehskina, only 4.8 % of the people think that the reforms are going to be a success. If the reforms are unsuccessful, protests are to be expected, but on what scale is yet unknown. Dr Bekeshkina concluded with a reminder that many important laws were accepted in the parliament and that an active civil society is of high importance. In the past the people were afraid of the division in the society, but now unity has grown amongst the population. The work against corruption needs to be continued, even though there is a highly sophisticated system of corruption in Ukraine which is very difficult to break down. Future prospects might include a third Maidan if the reforms are not successful. But she stays positive, stating that the reforms could be introduced through strong pressure from the civil society as well as pressure from the west.
Dr Arkady Moshes marked that it has now been 2 years since the dramatic regime change in Ukraine. He expressed his concerns regarding the fact that two thirds of the Ukrainians do not believe in the success of the reforms. Dr Moshes also mentioned the upcoming referendum vote in the Netherlands in regards to the EU association agreement with Ukraine that is most likely going to turn out negative. Even though the referendum is not binding, the Dutch government cannot really ignore the results of it. According to Dr Moshes the stability, political will and the capacity of Ukrainian authorities to carry out reforms is questioned, and, therefore, Europe is apparently starting to lose its interest to Ukraine. As for Ukraine’s government – there is no unity of the governmental coalition. Dr Moshes stresses that the source of frustration is the ongoing disputes within the government; the debate seriously and negatively affects decision-making.
Dr Moshes emphasized the urge to proceed with the reforms – which should be a priority as compared with the issue of full settlement of the conflict in the East of Ukraine. He also mentioned that the western media’s coverage on Ukraine for the last 2 years has focused too much on the conflict and too little on other processes. A misleading picture about a holding ceasefire has been created, even though in reality the death toll was constantly rising month after month. EU policy should now change, according to Dr. Moshes. Instead of pushing the constitutional reform and the autonomy for separatist entities, which is domestically too destabilizing and for which the administration simply does not have enough political resource, it would make more sense to apply conditionality to promote the reforms as a reformed and more resilient Ukraine will be better able to protect itself and also be more capable to reach progress in conflict- resolution.
He also pointed at the dysfunctionality of the Ukrainian state. There is a clear contradiction between a change-resistant government and a vibrant civil society thanks to which certain changes are happening. Lastly, Dr Moshes raised the question about the European choice as a driver of change. He reminded that during the revolution people were sacrificing their lives under the EU flag, which was unprecedented for non-citizens of the EU. But now, although 44 % of Ukrainians still support the EU membership, the hope is starting to faint and the EU is viewed as not appreciating their efforts, and a number of people choosing neither European nor Eurasian integration grows.”