The last oligarch standing (worthy of the title)?

February 11, 2015

The word “oligarch” means different things to different people – with many different definitions having varying degrees of merit.

However, in Ukraine, it is generally accepted as being defined, albeit rather loosely, as a grey cardinal – a person with significant political clout either beyond the power of the office they hold, or without holding any political office at all, who also controls a significant percentage of the GDP and/or control over strategically important sections of the economy, and is of course absurdly wealthy.

In short an individual that can change or seriously challenge the course of the country, through the numerous levers they hold, on a personal whim.  Their influence is omnipresent across political, economic and social life without necessarily holding any high office, or having a high public profile whatsoever.

Thus encompassing all of the above – rather than a pick ‘n ‘ mix from the above – separates the oligarchy from the simply ridiculously rich and corrupt.

Of the previously undisputed Ukrainian oligarchy, currently Dmitry Firtash is not really a player.  He is stuck in Austria fighting extradition to the USA and may thus not return to Ukrainian soil for many years to come.  His oligarchy by proxie, via Sergei Lyovochkin, to be blunt, isn’t really working out very effectively.

Viktor Pinchuk is extremely busy ingratiating himself with the West and has practically disappeared from Ukrainian life and politics.  It is far easier to ingratiate himself without being consistently mired in Ukrainian political shenanigans, and he is making very specific efforts to leave all such things behind him.

Rinat Akhmetov, who used to qualify as oligarch-in-chief, is now without the necessary political clout to fully meet the grey cardinal and oligarch requirements.  His political power has been seriously reduced since the Viktor Yanukovych fled Ukraine, and by a period of fence-sitting for far too long over events in eastern Ukraine.  He is, currently at least, only half an oligarch.  Whether his full/previous political influence will return when the political structures of the “people’s republics” emerge remains to be seen – though why would these structures want an Akhmetov oligarch, when they will be run by The Kremlin de facto?

President Poroshenko now fails to meet the definition simply due to overtly holding the (arguably) most powerful office in the land – notwithstanding any debate over whether his chocolate empire and TV Channel command enough of the national GDP, or are deemed as strategically economic enough to meet any oligarchical definition.

Nobody else has really ever met the oligarch definition – except Igor Kolomoisky.  Mr Kolomoisky wasted no time in tying his colours to the Ukrainian mask post EuroMaidan.  He financed volunteer brigades as well as directly funding the Ukrainian army when political leadership was in disarray.  His prima facie loyalty to the nation resulted in him being appointed as Governor of Dnepropetrovsk.

Mr Kolomoisky has also inserted friends and acquaintances in other positions of power when Ukraine was politically reeling from Crimean events and those that followed – the Odessa regional governor is an example.  He also part funded the Odessa Mayor’s campaign.  Indeed, Mr Kolomoisky de facto controls everything from Dnepropetrovsk westwards in southern Ukraine when it comes to local government.

Mr Kolomoisky financially backed several political parties in the RADA at the last October 2014 elections, as well as the president’s election campaign.  He also financed numerous “independent MPs”.  Thus his political power is not dependent on holding any office.

There is no need to write reams relating to his control over significant percentages of Ukrainian GDP, or his control within several strategic sectors of the Ukrainian economy.  Privat Bank is by orders of magnitude the biggest bank in Ukraine.  His control of numerous strategic energy companies is well known.  As an example, the RADA recently failed to change the law that would have removed Mr Kolomoisky’s control over Ukrnafta – unsurprisingly considering the above paragraph.

Mr Kolomoisky is also prominent in civil society, being the elected leader of the Ukrainian Jewish Congress, and backing many civil society initiatives large and small.

In short, he is a very powerful and very slick operator.  Far more accomplished than President Poroshenko or Prime Minister Yatseniuk – and more devious too.  Indeed, it is the threat/awareness of the threat Mr Kolomoisky presents, that is partly responsible for the relationship between President and Prime Minister remaining, despite significant differences between them.  Neither are strong enough to tackle Igor Kolomoisky alone.  Together they are only capable, wherever possible, of containing his influence – and they are not always capable of doing that.

Indeed a Jewish acquaintance commented, “only a Jew could do what he has done over the past year” – perhaps so.  Certainly only an oligarch choosing sides early in 2014 could optimise and manipulate the chaos to their best advantage could manage what he has – Jewish or otherwise.

Whatever the case, of the undisputed oligarchy to ever hold the title in Ukraine, there are currently only 1.5 oligarchs left that would fit the opening definition.  With the o.5 being Mr Akhmetov, Igor Kolomoisky appears to be the last oligarch standing worthy of the title.  Whether that is a good or bad thing, and whether he can be managed effectively by the political class and civil society, remains to be seen.


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